The ASX has posted a notable recovery so far this year, and its likely tonnes of buys are still hiding among the shares housed on the bourse.
Here's how I plan to go about identifying ASX opportunities this month.
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Considering this month's opportunities
In my opinion, a major part of investing is considering the opportunities on the table at any given time.
While I don't have a crystal ball, I can pretty much guarantee there're numerous monstrous opportunities among ASX shares right now. Though, risk-averse investors might wish to consider exercising a degree of caution.
The latest Australian GDP figures, released by the Australian Bureau of Statistics (ABS) yesterday, appear to show economic growth slowing and household savings falling. Though, the ABS also found inflation softened slightly over the 12 months to November. That led some to hope we've seen the peak of the cash-eating measure. That's likely not enough to halt rate hikes, however.
Thus, I plan to turn my attention to defensive ASX shares, blue-chip stocks, and index-tracking exchange-traded funds (ETFs) this month. They tend to provide greater surety than, say, growth shares.
However, any short-term volatility might reveal an opportunity to buy ASX shares I believe can outperform the market in 2023 and beyond. I'll likely scour sectors I think are oversold for such potential winners this month.
Finding ASX shares trading for cheap
Of course, buying an ASX share at too high a price can be a surefire way to slow down future returns. The lower the price an investor pays for a quality stock, the more scope they can leave for capital growth.
While the S&P/ASX 200 Index (ASX: XJO) and the All Ordinaries Index (ASX: XAO) have each lifted around 4.5% so far this year, there're still plenty of bargains on the bourse.
Measures like a company's price-to-earnings (P/E) ratio or price-to-book (P/B) ratio can help decipher if a share is trading for a good price. Particularly in comparison to its peers or its historical averages.
Scouring earnings releases
ASX investors generally get an insight into the companies behind the shares twice a year.
Fortunately, for those looking to buy stocks in March, many ASX-listed companies released such insight in recent weeks, in the form of earnings.
The February earnings season has likely left many ASX shares in the buy zone. And those looking to buy will likely be able to garner a timely understanding of a company's business.
They've also been given a window into a company's expected challenges and opportunities, as well as their planned path forward.
Such nuggets of information could be worth their weight in gold for those seeking out ASX shares to buy this month.
