Lets imagine a common portfolio for an Aussie investor.
You might have exposure to some of the major blue-chip companies listed on the ASX. This could be a variety of the big banks, mining and materials stocks etc.
You also know that a balanced portfolio includes stocks outside Australia. Based on this, you might have bought a fund that tracks the S&P 500 Index (SP: .INX).
This gives you exposure to sectors less common on the ASX like technology and healthcare, as well as big global companies like Nvidia (NASDAQ: NVDA) and Apple (NASDAQ: AAPL).
At this point, your portfolio is looking solid.
Now you may be looking to add a small but concentrated investment in one specific sector.
This is called thematic investing. Here are some growing themes you may be interested in targeting.
Commodities
Commodities are simply raw materials.
They can be precious metals like gold and silver or foodstuffs like corn and wheat and even energy resources like crude oil and natural gas.
This year, physical commodities like gold have far outpaced the returns of the ASX 200. The price of physical gold has risen more than 40%.
This can be a strong investment for diversification because commodity prices can often move differently from share prices.
Gold has a long history of preserving its value, so investors flock to it when other financial markets get rocky.
If you are interested in adding commodities like gold to your portfolio, some ASX ETFs to consider include:
- Global X Physical Gold (ASX: GOLD)
- BetaShares Gold Bullion ETF – Currency Hedged (ASX: QAU)
- VanEck Gold Miners ETF (ASX: GDX)
Artificial Intelligence
A growing theme that may interest investors is artificial intelligence.
According to Grand View Research, the global AI market is expected to grow at a compound annual growth rate (CAGR) of 38.1% from 2022 to 2030.
AI stocks can be companies involved in chip making, software, or firms that utilise artificial intelligence in their applications.
Importantly, the ASX does not have as many AI focussed stocks as other markets. This can make AI ASX ETFs beneficial, as investors can gain exposure to innovative AI companies in the US, Asia and Europe.
Some to consider for AI exposure include:
- Global X AI Infrastructure ETF (ASX: AINF)
- Global X Robo Global Robotics And Automation ETF (ASX: ROBO)
- Global X Artificial Intelligence ETF (ASX: GXAI)
ESG ASX ETFs
ESG stands for environmental, social, and governance. It is a growing theme amongst investors to target not only financial growth, but simultaneously have a positive global impact through their investment choices.
As the name suggests, this may involve targeting companies committed to contributing to climate targets, supporting human rights etc. It can also involve actively excluding companies that contribute to violence, war, alcohol/tobacco manufacturing or negatively impacting the environment.
If this sounds like a strategy you would like to include in your investment portfolio, some ASX ETFs to consider include:
