The ASX share market went through a lot of pain last year. So did my portfolio which dropped around 15%, though that doesn't account for the dividends I received.
Some of my biggest investments are growth-focused, with two of my biggest holdings being listed investment companies (LICs) that target businesses with good growth prospects.
Hopefully, the difficulty seen last year last won't be repeated this year. But whatever happens this year, I'm not going to let it affect my investment strategy in 2023.
Firstly, not every one of my ASX shares had a bad year. Fortescue Metals Group Limited (ASX: FMG) shares performed well for my portfolio; the company also paid another big dividend.
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How I'm planning to invest in 2023
When share prices drop, I get excited.
I plan to keep investing whether the market is a bit higher or a bit lower.
While share prices are moving, I believe there will always be an opportunity somewhere, whether it's share X or share Y.
Some individual names can become attractively valued compared to other options over a relatively short amount of time.
For example, BHP Group Ltd (ASX: BHP) shares are sitting at around $50 after a solid run over the past few months. But there are a number of other names that have been heavily punished since the start of 2022 such as Xero Limited (ASX: XRO), Megaport Ltd (ASX: MP1), and Siteminder Ltd (ASX: SDR).
A few months ago, I was suggesting that both ASX mining shares and ASX retail shares were cheap. But, both of those areas have gone on strong runs recently.
Where I'd look for ASX share bargains now
I think there are still some sectors that were heavily hit by interest rate rises but haven't seen a recovery in investor sentiment.
The ASX tech share sector is one area that I believe is a big opportunity. I think names like Xero and Megaport are compelling because of their revenue growth and increasing focus on profitability.
Other tech names I like the look of include Bailador Technology Investments Ltd (ASX: BTI), Frontier Digital Ventures Ltd (ASX: FDV), and REA Group Limited (ASX: REA).
I also think that some property-based ASX shares could be at a good discount to their actual underlying value. Names like Brickworks Limited (ASX: BKW) and perhaps real estate investment trusts (REITs) Centuria Industrial REIT (ASX: CIP) and Rural Funds Group (ASX: RFF) could also be opportunities.
While there is some pessimism around, I think that it won't always be the case. While the share market has recovered some of its lost ground over the last few months, I believe there are still plenty of opportunities and that's where I'll be looking.
