With the S&P/ASX 200 Index (ASX: XJO) reaching new record highs this week, my buying activity has been very subdued of late. While I believe that any time is fundamentally a good time to buy ASX shares, I am a value investor at heart, so I am less enthusiastic about buying ASX shares when the market is at record highs.
As such, I do not see too much value in many of the ASX's most popular shares right now. That particularly includes the big four banks like Commonwealth Bank of Australia (ASX: CBA) and National Australia Bank Ltd (ASX: NAB). But also with other ASX blue chips like Woolworths Group Ltd (ASX: WOW) and CSL Ltd (ASX: CSL).
However, I do think there are some ASX shares worth considering today. Here are the four stocks I would most likely buy if I got an unexpected windfall of cash right now.
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My top four ASX shares to buy right now
MFF Capital Investments Ltd (ASX: MFF)
MFF Capital is a listed investment company (LIC) that invests in a portfolio of underlying shares on behalf of its owners. These are usually American stocks and currently include the likes of Amazon, Meta Platforms, Mastercard and Home Depot.
MFF has a long history of delivering strong returns to its shareholders. It has also been increasing its dividend rapidly over the past few years. Currently, this LIC trades at a substantial discount to its underlying net asset value (NAV).
Earlier this week, the company confirmed that its pre-tax NTA was sitting at $4.33 a share, well over its current share price (at the time of writing) of $3.78. That effectively means you're buying $4.33 worth of assets for $3.78 right now. That's enough to make this stock a buy in the current market in my eyes.
Vanguard Australian Shares Index ETF (ASX: VAS)
My go-to buy when the market is hot is usually a simple index fund in the Vanguard Australian Shares ETF. Yes, it contains the stocks listed above, like CBA, NAB, and Woolies. But given the inherent diversification this ETF provides, as well as its long history of delivering solid returns, it makes a great all-weather investment.
With VAS, you are getting a slice of the entire ASX market. Well, a slice of the largest 300 stocks on the ASX, to be specific. This diversified index fund has historically offered decent capital growth, as well as hefty franked dividend income potential.
Vanguard MSCI Australian Small Companies Index ETF (ASX: VSO)
Another exchange-traded fund (ETF), VSO is a great index fund to hold if you want to buff up your exposure to the smaller end of the ASX (i.e. not the big banks and miners). Instead of holding the largest 300 stocks on the ASX, this ETF offers exposure to mid- and small-cap stocks. To illustrate, its current largest holdings are shares like NextDC Ltd (ASX: NXT) and Altium Ltd (ASX: ALU).
This ETF offers hefty dividend income potential as well, but I think it also has the potential to deliver higher capital growth than VAS over a long time horizon.
iShares Global Consumer Staples ETF (ASX: IXI)
Finally, let's talk about yet another ETF, this one with exposure to international stocks, rather than ASX shares.
The iShares Global Consumer Staples ETF is a thematic fund that invests in companies from all around the world, but only those within the consumer staples sector. These consumer staples stocks are usually companies that produce and sell food, drinks, alcohol and tobacco products, and household essentials.
Some examples of IXI's current holdings include Procter & Gamble, Walmart, Coca-Cola and L'Oreal.
I love investing in these kinds of companies, thanks to their defensive earnings bases. These tend to remain robust regardless of the economic weather, which is why this ETF is a go-to pick for me in this current red-hot market.
