Building a $100,000 share portfolio with just ASX exchange-traded funds (ETFs) isn’t as complicated as you might think. ETFs are an easy way to get broad-market diversification using a single ASX investment. As such, it’s relatively simple to build a highly diversified, internationally exposed portfolio with just 4 ASX ETFs. The hardest part is getting the $100,000 sum together! Here’s how I’d build the portfolio:
Start with $30,000 in the iShares Core S&P/ASX 200 ETF (ASX: IOZ)
This ETF simply tracks the S&P/ASX 200 Index (ASX: XJO) – which consists of the largest 200 publicly traded companies in Australia. This includes everything from Woolworths Group Ltd (ASX: WOW) and Commonwealth Bank of Australia (ASX: CBA) to Afterpay Ltd (ASX: APT) and Harvey Norman Holdings Limited (ASX: HVN). Think of it as a ‘slice of Australia’. The ASX 200 is a great index to have as a core of a portfolio as it has a focus on both growth and dividend income.
Add $30,000 to the iShares Global 100 ETF (ASX: IOO)
The ASX 200 is a good start, but now we’re throwing in some international diversification. This ETF tracks the largest 100 companies across the advanced economies of the world, including the United States, Japan, South Korea, Europe, and the United Kingdom. Some of its largest holdings are household names like Apple, Nestle, Samsung, Microsoft and Alphabet (sometimes called Google). These companies are the real movers and shakers in the global economy. As such I think some exposure to them through this ETF is a great addition to our portfolio.
$20,000 for the BetaShares Nasdaq 100 ETF (ASX: NDQ)
This ETF tracks the largest 100 companies on the US Nasdaq exchange. The Nasdaq is the second-largest US share market (behind the New York Stock Exchange) and tends to mostly house companies in the technology space. You’ll find all five of the ‘FAANG’ stocks here, being Facebook, Amazon, Apple, Netflix and Alphabet (which, being formerly known as Google, represents the ‘G’). You’ll also find Tesla, NVIDIA, Adobe and PayPal. In my view, there’s no better way to gain exposure to some of the hottest and best tech shares in the world than with this ETF. That’s why it makes our list today.
Finish off with $20,000 for the BetaShares Asia Technology Tigers ETF (ASX: ASIA)
Our final ASX ETF for the portfolio is this Asian, tech-focused fund. ASIA is the ’emerging market’s’ answer to the Nasdaq 100. This ETF tracks some of the biggest names in the Asian technology space. The list includes Tencent Holdings, which you may recognise from its recent investment in Afterpay. But there’s also the ‘eBay of China’ in Alibaba, the ‘Netflix of China’ in iQiYi, the ‘Google of China’ in Baidu and the ‘Amazon of China’ in JD.com. Tapping into tech trends in emerging markets like China is a good idea in the 21st century in my view, so this ETF is in our portfolio to make that happen.
Where to invest $1,000 right now
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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of Alphabet (A shares) and Tesla. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares) and Tesla. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS. The Motley Fool Australia owns shares of and has recommended BetaShares Asia Technology Tigers ETF. The Motley Fool Australia owns shares of AFTERPAY T FPO and Woolworths Limited. The Motley Fool Australia has recommended Alphabet (A shares) and BETANASDAQ ETF UNITS. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.