Home / Sector / ETFs / 2 ETFs worth considering for a diversified ASX share portfolio today

2 ETFs worth considering for a diversified ASX share portfolio today

These ETFs could be buys today…

Posted by
Sebastian Bowen
Sebastian Bowen has been a Motley Fool contributor since late 2018. Sebastian found his passion for writing and educating others about shares and all things finance after completing his studies in political, economic and social science and enjoys bringing this passion to life at the Fool. His investment philosophy is a simple one – buying high-quality companies at prices that make sense. When he’s not researching his next investment at all hours of the morning, Sebastian enjoys classic movies and likes to unwind with a good book, newspaper or record.
Published
| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Exchange-traded funds (ETFs) can be a great and easy way of increasing an ASX share portfolio's diversification. Whilst there are many top companies on the ASX boards, the reality is that the world of investing is far more than just Australian companies. So with that in mind, here are 2 ASX ETFs that offer the opportunity for quality diversification for any ASX share portfolio today.

The letters ETF on wooden cubes with golden coins on top of the cubes and on the ground

Image source: Getty Images

2 ASX ETFs for a diversified ASX share portfolio today

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This ETF from VanEck holds a concentrated portfolio of US shares that are picked by Morningstar for the quality of their 'moat'. A moat is a concept first defined by the great Warren Buffett. It speaks to a company's intrinsic competitive advantage. If a company possesses a significant and permanent competitive advantage over its competitors, it acts as a 'moat' around a castle, preventing enemies from plundering it.

At the present time, this ETF holds such companies as Google-owner Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL), Kellogg Company (NYSE: K), Microsoft Corporation (NASDAQ: MSFT) and Salesforce.com Inc (NYSE: CRM). Not the sort of companies available on the ASX.

This strategy of picking these 'wide-moat companies' seems to be working well for this ETF recently. Since its inception in 2015, MOAT has returned an average performance of 20.48% per annum. It charges a management fee of 0.49% per annum.

BetaShares Nasdaq 100 ETF (ASX: NDQ)

Another ETF to look at today is this offering from provider BetaShares. NDQ tracks the world-famous Nasdaq 100 Index over in the United States. The Nasdaq tends to house the newer, 'cooler' companies on the ASX.

Amongst its largest holdings, you will find the tech giants like Apple Inc (NASDAQ: AAPL), Microsoft, Alphabet and Facebook Inc (NASDAQ: FB). You'll also get shares like PayPal Holdings Inc (NASDAQ: PYPL), Adobe Inc (NASDAQ: ADBE) and Netflix Inc (NASDAQ: NFLX).

Again, the ASX 200 is very lightweight when it comes to these kinds of technology leaders. As such, this ETF could help fill that gap in an ASX-dominated share portfolio quite nicely. It's also got some healthy performance history to back it up. Since its ASX inception in 2015, NDQ has averaged a return of 22.41% per annum. It charges a management fee of 0.48% per annum.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Motley Fool contributor Sebastian Bowen owns shares of Alphabet (A shares), Facebook, Kellogg, and VanEck Vectors Morningstar Wide Moat ETF. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Alphabet (A shares), Alphabet (C shares), Apple, BETANASDAQ ETF UNITS, Facebook, Microsoft, Netflix, PayPal Holdings, and Salesforce.com. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended Adobe Inc. and has recommended the following options: long January 2022 $75 calls on PayPal Holdings, long March 2023 $120 calls on Apple, and short March 2023 $130 calls on Apple. The Motley Fool Australia owns shares of and has recommended BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended Adobe Inc., Alphabet (A shares), Alphabet (C shares), Apple, Facebook, Netflix, PayPal Holdings, Salesforce.com, and VanEck Vectors Morningstar Wide Moat ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ETFs

A young man talks tech on his phone while looking at a laptop with a financial graph superimposed across the image.
ETFs

3 ASX ETFs that could help build long-term wealth

| James Mickleboro

These funds could deliver good returns over the long term. Here's why.

Read more »

Young woman using computer laptop smiling in love showing heart symbol and shape with hands. as she switches from a big telco to Aussie Broadband which is capturing more market share
ETFs

3 quality ASX ETFs to buy and hold until 2036

| James Mickleboro

These funds could be well-placed to generate strong returns in the future.

Read more »

Man putting in a coin in a coin jar with piles of coins next to it.
ETFs

New to ASX ETFs? These 4 products could be a good start

| Cameron England

ETF investing has become hugely popular.

Read more »

A smiling young couple sit with a finance professional at a computer, looking at the screen.
ETFs

3 Betashares ETFs that I'd buy with $2,500

| Grace Alvino

I would want a mix of growth, quality, and long-term relevance from a small group of Betashares ETFs.

Read more »

A man sits cross-legged in a zen pose on top of his desk as papers fly around his head, keeping calm amid the volatility.
Share Market News

What $500 a month in ASX ETFs looks like in 10 years

| Leigh Gant

Boring, automatic, and relentless. That's how most everyday wealth actually gets built.

Read more »

Group of young people stacking hands together in an outdoor setting. A community of multiracial international people supporting each other.
ETFs

5 ASX ETFs for beginners with $500

| James Mickleboro

These funds could be worth getting acquainted with if you are new to the share market.

Read more »

A boy stands firm on a rocky cliff holding a rocket in each hand and looking up toward the sky, anticipating flying into space.
ETFs

SpaceX IPO: Should you buy an ASX space ETF to cash in?

| Sebastian Bowen

The countdown is on.

Read more »

Man on a tablet in a room with data centre technology.
ETFs

2 ASX ETFs positioned for the booming AI data centre buildout

| Leigh Gant

Here's a lower-risk way to own the foundations of the AI buildout.

Read more »