I believe ASX shares are a great way for beginner investors to gain exposure to the stock market.
Investing in shares seems easier to me than residential property. It doesn't come with a massive loan, nor do we need to deal with tenants or pay for repairs or land tax.
With investing in stocks, we can just sit back once we've made our investment. The CEO and the rest of the company's workforce are working for us to grow the underlying value of the business.
Which beginner ASX shares could be good options to start with? Let me tell you about two.
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Betashares Global Quality Leaders ETF (ASX: QLTY)
This isn't strictly an ASX share. However, we can buy it on the ASX and I think it's a great option for beginners.
An exchange-traded fund (ETF) is a fund that we can buy on a stock exchange, like the ASX, rather than going directly to the provider. It's useful to be able to invest in one trade and gain instant diversification to a large number of stocks at once.
I think it's a good idea for Aussies to invest in the global share market, one way or another. But, rather than investing in thousands of different businesses, why not just invest in the best of the best?
The idea of the QLTY ETF is that it invests in 150 of the highest-quality businesses on the global stock market. While having strong quality attributes doesn't guarantee good returns, particularly in the short-term, I think it gives the company a good chance to outperform the wider market in the longer-term.
Businesses in this portfolio must have a solid combined ranking across four key factors: return on equity (ROE), debt to capital, cash flow generation ability and earnings stability. In other words, these are highly profitable businesses that are regularly growing, have low debt and are utilising shareholder money very effectively.
Past performance is not a guarantee of future returns, but this fund returned an average of 14.1% per year over the five years to February 2025.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
This is one of my favourite ASX shares and it's the biggest position in my portfolio. It's a diversified investment house across a number of sectors and ASX shares.
Some of the biggest positions in its portfolio include Brickworks Ltd (ASX: BKW), TPG Telecom Ltd (ASX: TPG), Tuas Ltd (ASX: TUA), New Hope Corporation Ltd (ASX: NHC), BHP Group Ltd (ASX: BHP), Macquarie Group Ltd (ASX: MQG) and Wesfarmers Ltd (ASX: WES).
The business allocates its money for the long-term and is not afraid of investing very differently from what the S&P/ASX 200 Index (ASX: XJO) looks like.
Part of the strategy is to invest across different sectors and asset classes to both manage risks and capture growth opportunities. This helps its portfolio provide a diversified stream of cash flow, helping fund the ongoing growth of its dividend. Some interesting areas include private credit, agriculture and swimming schools.
The business has grown its dividend every year since 2000, which is the longest growth streak of any company on the ASX. It currently has a grossed-up dividend yield of approximately 4%, including franking credits.
I think this business can provide a pleasing mix of long-term growth, a good dividend yield and passive income growth.
