Most people assume building real wealth needs a big lump sum, perfect timing, or a knack for picking the next winner.

It rarely does.

More often, it comes down to something far less glamorous: investing a manageable amount, on a schedule, and then leaving it alone.

That is exactly where a simple, low-cost ETF portfolio earns its keep.

The two-fund foundation

A sensible starting point for many Australian investors is a two-pronged core.

The first piece covers home. The Vanguard Australian Shares Index ETF (ASX: VAS) holds the 300 largest companies on the Australian share market in a single position – the big banks, miners, and blue chips most of us already own indirectly.

The second piece covers the world. The iShares S&P 500 ETF (ASX: IVV) tracks the 500 largest companies listed in the United States.

However, do not let the US tag mislead you.

Names like Apple, Microsoft, Alphabet, and Nvidia earn revenue across the planet. Buying the S&P 500 is really buying a slice of global commerce, not just America.

Together, VAS and IVV pair Australian income and franking on one side with global growth on the other. Two trades. Genuine diversification.

Why drip-feeding works

Investing $500 a month is a strategy in itself.

It is called dollar-cost averaging.

Instead of trying to guess the perfect entry point, you buy a little every month – through the highs, the lows, and everything in between. When prices fall, your $500 buys more units. When prices rise, it buys fewer.

Over time, that smooths out your average purchase price and strips away the pressure of timing the market.

Then compounding takes over.

Each distribution you reinvest buys more units, which earn their own distributions, which buy more units again. Returns start earning returns. That is the quiet engine behind long-term investing.

The 10-year maths

Here is roughly how the numbers stack up.

$500 a month is $6,000 a year, or $60,000 contributed over a decade.

Assume an average compounded annual return of 8% to 9% – broadly in line with the long-run history of Australian and global share markets, though never guaranteed in any single year.

At that rate, your starting $500 plus monthly contributions could grow to somewhere around $88,000 to $93,000. 

The gap between what you put in and what you walk away with is compounding at work.

And here is the part that surprises people.

Compounding is slow at first. For the early years, your balance looks a lot like your contributions plus a little extra. Then it accelerates.

Stretch the same $500 a month out to 20 years at 8%, and the balance climbs toward $280,000. Double the time (or patience!), but far more than double the result.

Gradually, then suddenly.

Let it run

One rule matters even more than the maths: do not interrupt it.

As the late Charlie Munger put it, "The first rule of compounding is to never interrupt it unnecessarily."

Every sale resets the clock on the most valuable part – the back end, where the curve turns steep.

And you do not need to sell to be rewarded. The distributions VAS and IVV pay arrive along the way, and as your unit count grows, so does that income. Years of discipline can pay you an income stream without ever cashing out the engine that built it.

Foolish takeaway

None of this requires brilliance. It requires patience, a low-cost core, and the discipline to keep going when the headlines turn ugly.

Markets will fall along the way – sometimes sharply – and a 10-year plan only works if you stay invested through those dips.

But for investors willing to start small and think long, a simple ETF portfolio can turn an ordinary $500 a month into something that quietly, then suddenly, reshapes the picture.

The hardest part is not the maths. It is starting and not stopping.

The post What $500 a month in ASX ETFs looks like in 10 years appeared first on The Motley Fool Australia.

More reading

• New to ASX ETFs? These 4 products could be a good start
• Buying the Vanguard Australian Shares ETF (VAS)? There's a big change you should know about
• 3 world-class ETFs for Australian investors
• How to use the iShares S&P 500 ETF (IVV) to become a millionaire
• 3 ASX stocks I'd buy during a sharemarket crash

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended iShares S&P 500 ETF. The Motley Fool Australia has recommended iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Markets in 2026 have been a study in concentration. 

The Nasdaq Composite Index (NASDAQ: .IXIC) and the S&P 500 Index (SP: .INX) keep printing record highs, powered by the companies racing to build the artificial intelligence economy – chips, memory, data centres, and the cash-hungry giants spending big to win. 

Record-breaking listings are adding to the frenzy, with Elon Musk's SpaceX (NASDAQ: SPCX) set to debut on the Nasdaq in what may be the largest initial public offering (IPO) in history.

Amid all that exuberance, one asset has been left behind.

Bitcoin (CRYPTO: BTC) is down more than 40% over the past 12 months and around 28% since the start of the year. It now trades near US$62,000, well below the record high of roughly US$126,000 set last spring. More than US$1 trillion in value has evaporated in eight months.

So what is going on?

Follow the liquidity

Bitcoin has a fixed supply. Only 21 million coins will ever exist, and that ceiling is hard-coded. When supply cannot move, price becomes a story about demand – and demand is really a story about where money is flowing.

Right now, capital is chasing momentum. The headlines belong to AI, semiconductors, memory, and mega-IPOs, and money tends to follow the loudest narrative. SpaceX's listing alone is expected to soak up tens of billions of dollars in fresh capital. Every dollar committed to the next hot story is a dollar not parked in Bitcoin.

This matters because Bitcoin no longer trades in its own universe. Since spot Bitcoin ETFs arrived and large institutions gained easy access, the asset has behaved like any other risk play – rallying when liquidity is loose and sagging when it tightens. With markets now pricing in the possibility of higher-for-longer interest rates, the easy money that once lifted speculative assets is harder to find.

Bitcoin isn't alone

If this were purely a crypto problem, you might expect everything else to be flying. It isn't.

Gold and silver, the traditional safe havens, have also come off the boil after strong runs. And closer to home, plenty of quality smaller companies have drifted sideways or lower despite solid fundamentals underneath them. Good businesses are being ignored not because anything broke, but because attention – and capital – is pooling in a handful of crowded trades.

That is the story of 2026 so far. When liquidity converges on one theme, even sound assets can be starved of buyers. Price and value can part ways for a while.

None of this makes Bitcoin "safe". It remains a speculative asset whose future hinges on unresolved questions – how regulators treat it, how central banks set policy, whether it earns lasting status as a store of value, and how widely it gets used as an alternative form of money. Those debates are far from settled.

Foolish Takeaway

It helps to remember Bitcoin's character. Its history is a cycle of brutal drawdowns followed by recoveries that have, so far, climbed even higher than before. Falls of 50% or more are not new. They have happened repeatedly, and each time, the obituaries were written early.

That pattern is no guarantee. But it is a reminder that volatility is the toll Bitcoin charges, not necessarily a sign the journey has ended.

For now, the share market's record-setting names are absorbing the oxygen, and Bitcoin is paying the price for being yesterday's headline. Liquidity, though, is restless. It rotates. When the AI euphoria cools and attention broadens again, the assets left behind in 2026 may look very different in hindsight. Patient investors who understand what they own – and can stomach the swings – are usually the ones still standing when the cycle turns.

The post Why is the Bitcoin price down while shares hit highs? appeared first on The Motley Fool Australia.

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• Why did the Bitcoin price just plunge more than 7%?

Motley Fool contributor Leigh Gant owns Bitcoin. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin. The Motley Fool Australia has positions in and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. 

Artificial intelligence might live in the cloud, but the foundations get built on the ground. 

Every chatbot answer and every model trained has to run somewhere – and that somewhere is a vast, power-hungry data centre.

That simple fact is driving one of the largest capital spending waves in corporate history.

Concrete, copper, and kilowatts

The world's biggest technology companies – Amazon, Microsoft, Alphabet, and Meta Platforms – are racing to build the physical backbone of AI. Together, these hyperscalers plan to spend a combined US$725 billion on AI development this year, with roughly 70% to 75% of that flowing straight into infrastructure. 

Infrastructure here means something concrete. It means the data centres themselves, the chips inside them, the networking that connects them, and – crucially – the power grids and cooling systems that keep them running.

And this is not a one-year story. There are Broad estimates that global data centre spending will exceed US$2 trillion over the next five years. 

A data centre is essentially a warehouse full of servers that runs around the clock. It draws enormous amounts of electricity, generates significant heat, and requires constant cooling. Build thousands of them, and you create huge, durable demand for utilities, copper, engineering, and essential-service operators.

That is the part of the AI trade that often gets overlooked. The picks and shovels, not the gold.

Why a basket beats a single bet

Picking the single biggest winner from this buildout is hard. Will it be the chipmaker, the power company, the cooling specialist, or the copper miner? Guess wrong, and you can miss the whole move.

This is where exchange-traded funds (ETFs) earn their keep. Instead of betting on one name, an ETF spreads your capital across a basket of companies tied to the same theme. You trade the chance of picking a single moonshot for far lower concentration risk. 

Two ASX ETFs offer a neat way in.

The first is the VanEck FTSE Global Infrastructure (Hedged) ETF (ASX: IFRA). It holds around 150 listed infrastructure companies across developed markets, spanning electric utilities, toll roads, pipelines, airports, and rail networks. 

Think of IFRA as the boring backbone of the boom. Every data centre needs a power grid, and this fund owns the companies that run them. It currently trades around $25.50 and is forecast to yield almost 3% over the next 12 months. 

The second is the more direct play – the Global X Artificial Intelligence Infrastructure ETF (ASX: AINF). Launched in 2025, it was the first ASX-listed fund built specifically around the physical AI buildout.

AINF holds an equally weighted basket of 31 stocks across energy, materials, and data infrastructure, including copper and uranium producers, utilities, and engineering firms. It has large positions in Delta Electronics, GE Vernova, and Vertiv Holdings. 

The trade-off is clear. IFRA is broader, hedged, and pays an income. AINF is narrower, more thematic, and built purely for this moment.

Foolish Takeaway

The AI data centre boom is real, and it runs on far more than software. It runs on power, metal, and physical construction – the kind of long-lived assets that tend to keep earning long after the hype fades.

Neither fund is risk-free. A slowdown in hyperscaler spending or a renewed rise in long bond yields could weigh on both. But for investors who believe the buildout has years to run, IFRA and AINF offer two distinct ways to own the foundations rather than guess the winner.

Sometimes the smartest way to play a gold rush is to back the people selling the shovels.

The post 2 ASX ETFs positioned for the booming AI data centre buildout appeared first on The Motley Fool Australia.

More reading

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, GE Vernova, Meta Platforms, Microsoft, and Vertiv. The Motley Fool Australia has recommended Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The cost of a comfortable retirement keeps climbing. Inflation may be cooling on paper, but cooling is not the same as falling – prices are still rising, just a little more slowly. That quiet creep matters more than most people realise.

It means the finish line keeps moving.

For Australians turning 50, that is an uncomfortable thought. Retirement is no longer an abstract idea somewhere over the horizon. It is roughly a decade until you can access your super at 60, and around 17 years until the Age Pension kicks in at 67. The window to fix things is still open. It is just narrower than it used to be.

So, where do you actually stand?

The gap hiding in plain sight

The Association of Superannuation Funds of Australia (ASFA) puts the average super balance for a 50 to 54-year-old man at $254,071 and for a woman at $190,175. Useful as a benchmark. Sobering as a starting point.

Because the same body estimates a single homeowner now needs around $630,000 to retire comfortably at 67, while a couple needs $730,000. Those targets rose in February for the first time in three years, driven by exactly the living costs that refuse to sit still.

Line the two numbers up, and the gap is obvious. Many 50-year-olds are sitting on roughly a third of what they will eventually need.

The median tells an even starker story. More than half of Australians in their early 50s hold less than the average, because a handful of large balances drag the average upward. If you feel behind, you are in very good company.

Where the catch-up actually happens

Here is the part that gets missed. Closing the gap is not only about contributing more. It is about what those contributions earn.

A balance growing at 7% a year looks very different over 15 years to one growing at 9%. On a six-figure starting balance, that two-point difference can mean hundreds of thousands of dollars by retirement. Returns are the lever most people leave untouched.

That is why how your super is invested deserves a hard look. Many Australians sit in a default 'balanced' option without ever choosing it. A higher-growth allocation – tilted toward shares rather than cash and bonds – carries more short-term volatility, but historically the Australian share market has returned close to 9% a year over the long run, including dividends. Low-cost index exposure, through funds like the Vanguard Australian Shares Index ETF (ASX: VAS) or the iShares S&P 500 ETF (ASX: IVV), is one way some investors build that growth tilt.

Contributions still matter, and the rules are about to get more generous. From 1 July 2026, the concessional contributions cap rises from $30,000 to $32,500. If your total super balance sits under $500,000, carry-forward rules let you mop up unused cap from the previous five years in a single hit – a genuine catch-up mechanism for anyone who has fallen behind. (Higher earners should keep Division 293 in mind, and very large balances Division 296, but neither changes the core opportunity.)

Foolish Takeaway

Turning 50 behind on super is not a verdict. It is a prompt.

The maths is not kind to complacency – markets fall, and the next 15 years will not move in a straight line. However, the same maths rewards action. Slightly higher contributions, a sharper look at how your money is invested, and the simple discipline of aiming for a margin of safety above the bare minimum can reshape what 'enough' looks like.

The cost of living will keep rising. The question worth sitting with at 50 is whether your super is built to outrun it.

The post Behind on superannuation at 50? Here's what to do now appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
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• Why did ASX 200 retail shares outperform last week?

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended iShares S&P 500 ETF. The Motley Fool Australia has recommended iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Fifty thousand dollars a year, landing in your account without you lifting a finger. It is the quiet ambition behind a lot of Australian investor portfolios.

Most people size it up the same way. Pick an income target, pick a yield, and divide one by the other.

At a 3% dividend yield, $50,000 a year points to a portfolio of around $1.67 million.

It is a tidy number. It is also wrong.

The simple sum ignores the two forces that shape every income investor's real result: tax and the franking credits that can soften it. Account for both, and the honest answer stops being a single figure. It becomes a range, and where you land depends almost entirely on your own tax position.

Why assume 3%? Because the broad market currently yields a little above that level. Some quality shares pay more, and you could aim higher. However, planning on a conservative 3% leaves room to be pleasantly surprised rather than disappointed.

Franking credits do heavy lifting

Here is the part the back-of-the-envelope version leaves out.

Fully-franked dividends arrive with a credit attached for the 30% company tax already paid on those profits. You declare the larger grossed-up figure as income, then use the credit to offset your own tax bill. If the credit is bigger than the bill, the difference is refunded.

That one feature pulls the answer in two directions.

Picture someone living mainly off their shares. Fully-franked dividends of around $42,000, once grossed up, sit inside the lower tax brackets. The franking credits more than cover the tax owed, and a refund tops up the rest. After tax, that investor clears roughly $50,000 from a portfolio closer to $1.4 million than $1.67 million.

Now, picture someone still earning a healthy salary. Their dividends stack on top of that income and face a much higher marginal rate. To keep $50,000 after tax, they might need about $57,000 in fully-franked dividends in the 37% bracket, or closer to $66,000 at the very top rate. At 3%, that is a portfolio of roughly $1.9 million to $2.2 million.

Same goal. Same yield. Around $800,000 difference in capital, decided by your tax bracket alone.

The catches worth knowing

A few things can move your number again.

Not every dividend is fully franked. Banks like Commonwealth Bank of Australia Ltd (ASX: CBA) and miners like BHP Group Ltd (ASX: BHP) usually frank in full, but broad funds such as the Vanguard Australian Shares Index ETF (ASX: VAS) pass through only partial franking, and most property trusts pay unfranked distributions. Less franking means less of that valuable offset.

Capital gains tax, meanwhile, is the dog that does not bark. A true income portfolio is one you hold, not one you sell – and CGT is only triggered on a sale. Draw the dividends, leave the shares be, and you sidestep it entirely. That is a quiet part of the appeal.

There is also a structural shortcut. Inside superannuation, earnings are taxed at just 15%, and in the pension phase, that can fall to zero, turning franking credits into a straight cash refund. The same dividends simply travel further.

Foolish Takeaway

So how large does the portfolio need to be? Somewhere between roughly $1.4 million and $2.2 million for $50,000 a year at a 3% yield, with the precise figure set by your tax rate, your franking mix, and whether you invest inside or outside super.

None of it is guaranteed. Yields shift, dividends get cut, and the share market can fall just as you begin drawing on it. But the principle holds. In Australia, the headline yield is only half the story. Franking credits write the other half – and they are why the real number is rarely the one the simple sum hands you.

The post How big an ASX portfolio earns $50,000 a year in dividends? appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• 3 ASX stocks that look like classic Warren Buffett investments
• 3 quality ASX ETFs to buy and hold until 2036
• Buying ASX 200 bank stocks like Westpac and CBA shares? Here's why these funds are betting against you
• Why did ASX 200 retail shares outperform last week?

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Tasmea Ltd (ASX: TEA) share price has continued its powerful run.

Just last week, this ASX small cap was already catching attention after rising more than 120% over the prior 12 months.

Since then, Tasmea shares have surged another 20% after the engineering and maintenance services company announced a major acquisition that could materially expand its growth opportunity.

Tasmea is buying Victoria-based Maxim Group in a deal worth up to $254 million.

The acquisition is significant because it gives Tasmea a clear entry into one of the hottest infrastructure markets in Australia right now: data centres.

So, what has investors excited?

Why Tasmea shares are rising

The company provides specialist trade services to essential Australian industries, including mining, oil and gas, infrastructure, defence, power, water, renewables, and telecommunications.

That work includes maintenance, shutdowns, emergency breakdown services, brownfield upgrades, and labour solutions.

In simple terms, Tasmea helps keep important physical assets operating.

That may not sound glamorous. However, the share market often becomes interested when a practical business combines recurring demand, disciplined execution, and strong earnings growth.

The Maxim acquisition could add another important ingredient: exposure to structural demand from artificial intelligence, cloud computing, battery storage, and electrification.

A move into data centres

Maxim Group is an electrical contractor based in Victoria. It specialises in electrical work for large digital infrastructure assets, including wiring and cabling.

Maxim has around 600 workers and is currently working on 30 projects.

Approximately 55% of Maxim's work reportedly comes from data centres, while the remaining 45% comes from industrial-scale battery storage projects and rail electrification.

That is an attractive mix.

Data centres are benefiting from rising demand for artificial intelligence processing, cloud computing, and digital storage. Meanwhile, battery storage and rail electrification are linked to the broader energy transition and infrastructure spending.

Tasmea Managing Director Stephen Young reportedly described data centres as the hottest market in Australia. He also said Maxim had a seven-year pipeline of work worth around $1.3 billion.

That long pipeline appears to be one reason investors have responded so strongly.

Why this deal could matter

Tasmea was already growing quickly before this acquisition.

In FY25, the company reported statutory revenue growth of 37% to $547.9 million. Statutory operating earnings (EBIT) rose 60% to $74.4 million, while net profit after tax increased 74% to $53.1 million.

Importantly, earnings per share (EPS) increased 53% to 23.2 cents.

That matters because it suggests shareholders were not just seeing a bigger company, but a more profitable one on a per share basis.

The company also completed the acquisition of WorkPac Group in December 2025. That deal expanded Tasmea's workforce solutions capabilities and strengthened its exposure to skilled labour markets.

The Maxim acquisition now appears to give Tasmea another meaningful platform for growth.

Tasmea already operates across multiple separate businesses. If management can continue acquiring quality operators, integrating them carefully, and supporting growth across the group, the company may have a much larger opportunity than the market appreciated a year ago.

What are the risks?

Tasmea shares have already had a very strong run. When a share price rises quickly, expectations can rise just as fast.

That means any disappointment around earnings, margins, integration, or future guidance could lead to volatility.

Acquisitions also require careful execution. Tasmea needs Maxim to retain key staff, continue winning work, maintain customer relationships, and deliver on its pipeline.

The final acquisition price also includes a three-year earn-out of up to $70 million, meaning part of the total consideration depends on future performance.

There is also a broader point to consider. Data centres may be a booming market, but a hot sector does not automatically guarantee strong shareholder returns.

Foolish Takeaway

Tasmea's latest share price surge shows how quickly the market can re-rate an ASX small-to-mid cap when the investment story evolves.

Only recently, Tasmea looked like a fast-growing specialist services business with strong earnings momentum.

Following the Maxim acquisition, it now has more direct exposure to data centres, battery storage, and electrification.

That does not remove the risks. After such a sharp share price rise, investors should be careful not to ignore valuation or execution challenges.

However, this acquisition could prove to be a significant step in Tasmea's long-term growth strategy.

The post Tasmea share price rockets as it enters data centre race appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant has positions in Tasmea. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips

Could these giant US IPOs change how ASX investors think about growth?

For years, many Australian investors have been spoilt for choice when it comes to banks, miners, healthcare, and infrastructure shares.

But let's be honest.

The S&P/ASX 200 Index (ASX: XJO) is not exactly overflowing with companies building reusable rockets, artificial intelligence models, or the next generation of space-based infrastructure.

That is why the looming public debuts of SpaceX, OpenAI, and Anthropic could be so fascinating for ASX investors.

These companies sit at the centre of some of the world's most powerful technology themes. SpaceX is pursuing reusable rocket technology, satellite internet, and long-term space ambitions. OpenAI and Anthropic are at the front of the artificial intelligence race.

For investors used to the familiar rhythms of the Australian market, that is a very different kind of growth story.

Yet, before getting swept up in the excitement, there is an important question to ask: Is buying into a blockbuster initial public offering really the best way to gain exposure?

The excitement is obvious

SpaceX is expected to be one of the most-watched IPOs in history if it proceeds.

The potential appeal is easy to understand. This is a business focused on self-landing rockets, Starlink satellite internet, and ambitious plans that stretch far beyond the typical corporate growth playbook.

The company's prospectus outlined three divisions: its rocket business, Starlink satellite internet, and artificial intelligence. Crucially, Starlink was the only profitable division at that stage, while the broader business was still loss-making.

For all the excitement, investors buying into a company like SpaceX would not simply be buying current profits. They would be buying a bold view of the future.

That can be powerful. But it can also be risky.

IPOs can be tricky for investors

Blockbuster IPOs often come with enormous hype. They can attract attention from retail investors, institutions, index funds, and thematic investors all at once.

However, IPO investing is not always straightforward.

One challenge is valuation. By the time a famous private company reaches public markets, much of the early value creation may already have occurred. Early investors, founders, employees, and private market backers may have acquired shares at far lower prices.

Once lock-up periods expire, some of those holders may look to sell shares and crystallise large gains. That selling pressure can weigh on a newly listed company's share price, even if the long-term story remains compelling.

That is one reason IPOs can sometimes fall after listing.

It does not necessarily mean the business is poor. It may simply mean the initial public market price left little room for error.

How ASX investors could gain exposure

Australian investors may have a few different paths to consider.

One option is direct participation if a US IPO includes an Australian retail offer. CommSec has been named as a lead Australian retail broker for the potential SpaceX IPO, with investors expected to require an international shares account.

Another option is to wait until the company lists and buy shares on the US market through an international trading account.

A third option is via listed vehicles that already hold exposure to these private companies.

One example is Pengana Private Equity Trust (ASX: PE1). The trust has exposure to SpaceX, OpenAI, and Anthropic through its private equity portfolio. Its SpaceX position has previously been described as one of the largest holdings in the portfolio.

That does not make PE1 a pure SpaceX investment. In fact, that may be the point. It offers exposure alongside a broader private equity portfolio, rather than relying solely on the success of a single newly listed company.

There is also thematic exposure. The recently launched Betashares Space Industry ETF (ASX: RCKT) is designed to provide exposure to the global space industry and may be able to include a major company like SpaceX quickly after listing, subject to index rules.

Foolish Takeaway

For ASX investors, the arrival of companies like SpaceX, OpenAI, and Anthropic on public markets could feel like a window into the next era of global innovation.

IPO prices can be demanding. Early shareholders may sell. Markets can overpay for the most popular stories. And even great companies can make poor investments if bought at the wrong price.

For long-term investors, the key may be to separate the dream from the deal.

Owning a company building rockets to Mars or intelligence systems for the future may sound extraordinary. But as always, valuation, business quality, time horizon, and portfolio risk still matter.

The post SpaceX IPO buzz grows as ASX investors eye global tech giants appeared first on The Motley Fool Australia.

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• SpaceX starts trading today. Here's what ASX investors need to know
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Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Australian share market is not having one of its better years.

That does not mean there are no strong returns available. It may simply mean investors need to widen the lens.

For many Australian investors, the first step beyond the ASX is usually the United States. That makes sense. The US remains the world's largest economy and is home to many of the companies most closely linked to artificial intelligence, including Nvidia, Alphabet, and Micron.

The iShares S&P 500 ETF (ASX: IVV) has been one of the simplest ways for ASX investors to get that exposure. The fund seeks to track the performance of the S&P 500 Net Total Return Index in Australian dollars, before fees and expenses.

However, the US is not the only place benefiting from the next wave of global growth.

Closer to our shores, some country-specific ASX ETFs have been racing ahead of both the Australian market and the S&P 500 Index (SP: .INX). Two standout examples are the BetaShares Japan ETF – Currency Hedged (ASX: HJPN) and the iShares MSCI South Korea ETF (ASX: IKO).

The Vanguard Australian Shares Index ETF (ASX: VAS) remains a useful broad exposure to Australian shares. Yet over the past 12 months, HJPN and IKO have shown how powerful it can be to think globally.

Japan is back on the radar

The HJPN ETF has gained more than 53% over the past year.

The fund gives investors exposure to a diversified portfolio of large, globally competitive Japanese companies, while hedging currency exposure back into Australian dollars. BetaShares lists HJPN in the global shares category and notes its Japan focus and currency-hedged structure.

Japan has become one of the more interesting markets in the world for long-term investors.

After decades of deflation and lacklustre investor interest, the country is seeing a mix of catalysts emerge. Inflation has normalised, companies are being pushed to improve corporate governance, and more Japanese businesses are focusing on dividends, buybacks, and stronger capital allocation.

That is not just attracting retail ETF money.

Warren Buffett's Berkshire Hathaway has also increased its exposure to Japanese companies. The appeal appears to be a combination of compelling valuations, strong balance sheets, and more efficient use of capital.

In other words, Japan is not just a short-term trade. It may be a structural reappraisal of an overlooked market.

Korea is riding the AI supply chain

If Japan has been strong, South Korea has been explosive.

The IKO ETF has surged around 200% over the past 12 months, helped by massive gains in Korean semiconductor stocks.

BlackRock says IKO provides exposure to large and mid-sized companies in South Korea and can be used to express a single-country market view.

The key driver has been simple: artificial intelligence needs memory chips.

IKO has heavy exposure to Samsung Electronics and SK Hynix, two global leaders in memory semiconductors. These companies sit deep inside the AI infrastructure buildout, powering data centres, cloud computing, and high-performance computing demand.

This is where the phrase "skate to where the puck is going" matters.

Australian investors can own banks, miners, supermarkets, insurers, and infrastructure companies at home. Many of those businesses are excellent. But the ASX is light on the deepest parts of the AI supply chain.

Korea offers exposure to a very different part of the global economy.

The bigger lesson for ASX investors

The point is not that investors should chase the strongest ETF of the past year.

That can be dangerous. A fund that has surged 50%, 100%, or 200% can easily pull back. Country-specific ETFs can also be more concentrated than broad-market index funds.

However, the bigger lesson is important.

A diversified portfolio does not have to mean owning only the largest companies in Australia. It can mean owning baskets of countries, sectors, and themes that give investors exposure to where global earnings may be heading next.

The ASX remains a sensible starting point. The US remains a powerful global engine.

However, the Japanese and South Korean markets show that the investment world is far bigger than our own backyard — and far broader than the biggest names on Wall Street.

The post These 2 top performing ASX ETFs show why investors should look beyond Australia and the US appeared first on The Motley Fool Australia.

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• Meet the simple ASX index fund up 220% in 12 months
• Here are the 3 best performing iShares ASX ETFs over the last year

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Berkshire Hathaway, BlackRock, Micron Technology, Nvidia, and iShares S&P 500 ETF. The Motley Fool Australia has recommended Alphabet, Berkshire Hathaway, Nvidia, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Australian share market has not exactly been a one-way ticket higher lately.

Plenty of investors have been dealing with a choppy S&P/ASX 200 Index (ASX: XJO), stretched bank valuations, weaker technology sentiment, and plenty of uncertainty around interest rates, inflation, and global markets.

Yet hidden beneath the broader market noise, one ASX small cap has been quietly doing something very different.

At the time of writing, Tasmea Ltd (ASX: TEA) shares have surged more than 120% over the past 12 months, including a sharp rise of more than 20% in just the past few weeks.

That is a very different outcome to the broader market. As a rough benchmark, the iShares Core S&P/ASX 200 ETF (ASX: IOZ), which tracks the ASX 200, is up only around 2.3% over the same 12-month period, excluding dividends.

So, what is going on?

The boring business delivering exciting returns

Tasmea is not a flashy technology company. It is not riding an artificial intelligence boom. It is not promising to reinvent finance, healthcare, or mining.

Instead, it provides specialist trade services to essential Australian industries.

The company operates across maintenance, shutdowns, emergency breakdown work, brownfield upgrades, and labour solutions. Its customers include asset owners across mining and resources, oil and gas, infrastructure, defence, water, power, renewables, telecommunications, and other critical industries.

In plain English, Tasmea helps keep important physical assets running.

That might not sound exciting. However, the share market often becomes interested when a business combines practical demand, strong execution, and rising earnings.

Tasmea appears to be doing exactly that.

Earnings growth is doing the heavy lifting

One reason Tasmea shares have been charging higher is simple: the company is growing quickly.

In FY25, Tasmea reported statutory revenue growth of 37% to $547.9 million, operating earnings (statutory EBIT) growth of 60% to $74.4 million, and net profit after tax growth of 74% to $53.1 million.

Importantly, earnings per share (EPS) rose 53% to 23.2 cents.

That matters because EPS growth is one of the cleanest ways to measure whether shareholders are actually participating in a company's growth. Revenue growth is nice. Net profit growth is very nice. EPS growth is often nicer again.

The company has also guided for further strong growth in FY26. Based on its previously stated guidance, EPS is expected to move towards around 30 cents per share, implying another significant step higher.

That is before investors fully consider the potential longer-term benefits from the WorkPac acquisition.

Why WorkPac could matter

Tasmea completed the acquisition of WorkPac Group in December 2025.

WorkPac is a workforce solutions business, and the strategic logic is fairly clear. Tasmea already operates in industries where skilled labour is critical. By adding WorkPac, the company strengthens its ability to source, mobilise, and deploy labour across its existing operating divisions.

This could help Tasmea support organic growth, improve labour certainty, and potentially unlock synergies over time.

Of course, acquisitions come with risk. Integration has to be managed carefully. The business also needs to keep winning work, maintaining margins, and avoiding the temptation to grow just for the sake of size.

However, if management executes well, WorkPac could make Tasmea a more powerful platform than the market appreciated a year ago.

The small-cap sweet spot

This is where Tasmea becomes interesting from a long-term investing perspective.

Small caps that successfully grow into mid-cap or large-cap businesses can potentially reward shareholders in two ways.

First, earnings can grow. That means the underlying business becomes more valuable over time.

Second, the market may eventually decide the business deserves a higher valuation multiple. That can happen when investors gain confidence in the quality, durability, and scale of the company's earnings.

That combination — earnings growth plus multiple expansion — can be powerful.

Foolish takeaway

Tasmea shares have already had a huge run, so investors should not ignore the risks.

The stock is no longer undiscovered. Expectations are rising. Any slowdown in earnings growth, acquisition misstep, margin pressure, or weakness in end-market demand could lead to volatility.

However, Tasmea remains a useful reminder that strong returns do not always come from the loudest corners of the market.

Sometimes they come from underappreciated businesses doing essential work, growing earnings, and steadily building scale in the background.

The post Could this surging ASX small cap still be hiding in plain sight? appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant has positions in Tasmea. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips

Retirement planning has a way of feeling more precise than it really is.

There are averages. There are benchmarks. There are calculators. There are projections that stretch neatly across 20, 30, or even 40 years.

But real life is rarely that clean.

Markets fall. Inflation bites. Healthcare costs rise. Plans change. Adult children may need support. A home may need repairs. A dream retirement may cost more than expected.

That is why the question is not simply whether Australians have enough superannuation to retire comfortably.

The better question may be: Have they built enough margin of safety?

The average balance may not be enough

According to figures cited by the Association of Superannuation Funds of Australia (ASFA), the average superannuation balance for Australians aged 55 to 59 is $319,743 for men and $242,945 for women.

That is a meaningful amount of money.

However, it is not obviously enough to fund a comfortable retirement by itself.

ASFA estimates that a comfortable retirement requires around $54,840 per year for a single person and roughly $77,375 per year for a couple. Its suggested lump sum is about $630,000 for singles and $730,000 for couples, assuming home ownership and some Age Pension support later in retirement.

On those numbers, many Australians in their mid-to-late 50s may still have a sizeable gap.

And that is before adding a buffer.

Why a margin of safety matters

In investing, a margin of safety means allowing room for things to go wrong.

That same idea applies to retirement.

A person who reaches retirement with just enough may be vulnerable if the numbers shift against them. A person who retires with more than enough has options.

That margin can matter in three big ways.

The first is investment returns. A retirement plan based on strong returns may look fine on paper. But returns do not arrive in a straight line. A poor run of markets early in retirement can have a major impact if retirees are drawing from their portfolio at the same time.

The second is inflation. Even modest inflation can steadily reduce purchasing power over time. A retirement income that feels comfortable today may feel tighter 10 years from now if living costs rise faster than expected.

The third is behaviour. When people feel behind, they can disengage. That may mean ignoring super, leaving money in unsuitable investments, or failing to use available contribution rules before retirement.

None of that is ideal.

The late 50s can still be powerful

The optimistic part is that 55 is not necessarily too late.

For many Australians, the decade from 55 to 65 could be one of the most important wealth-building periods of their lives.

Income may still be strong. The mortgage may be smaller. Children may be more independent. And the super balance may finally be large enough for investment returns to make a meaningful difference in dollar terms.

That is why this period should not only be viewed as the final lap before retirement. It may be the decade where the retirement outcome is most improved.

Continued employer contributions can help. Salary sacrifice may help some Australians boost their super in a tax-effective way. Catch-up concessional contributions may also be available for some people with total super balances below the relevant threshold.

For eligible homeowners, downsizer contributions may also become part of the picture later in life. That can potentially allow proceeds from selling a family home to be contributed into super, subject to the rules.

Investing well matters

One of the biggest risks may be becoming too conservative too early.

At 55, many Australians could still have a decade or more before retirement, and potentially 25 to 35 years of life after that. That is still a long investment horizon.

Cash and defensive assets have a role. But if returns fail to keep pace with inflation over long periods, the real value of retirement savings can fall behind.

That does not mean taking reckless risks. It means understanding what the superannuation balance is invested in, whether the asset allocation suits the timeframe, and whether the portfolio has enough growth potential to support a long retirement.

Foolish takeaway

Retiring comfortably is not just about reaching a number.

It is about building enough flexibility to handle the things that do not appear neatly in a spreadsheet.

The average superannuation balance of a 55-year-old may not be enough to retire comfortably today. But for many Australians, the window is not closed.

The next decade could still provide time to contribute more, invest thoughtfully, review strategy, and build a stronger buffer.

In retirement, "just enough" can be fragile.

A margin of safety may be what turns retirement from a financial balancing act into something closer to genuine peace of mind.

The post Why your superannuation may need a bigger buffer in 2026 appeared first on The Motley Fool Australia.

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• Top brokers name 3 ASX shares to buy next week
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• Buying ASX 200 bank stocks like Westpac and CBA shares? Here's why these funds are betting against you
• Why did ASX 200 retail shares outperform last week?

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Smart Parking Ltd (ASX: SPZ) is not the kind of technology company that usually dominates market chatter.

It does not have the sparkle of artificial intelligence. It is not selling futuristic consumer hardware. And its core business — parking management — is hardly glamorous.

But that was part of the appeal when Smart Parking was described as one of the ASX's unflashy success stories powering life behind the scenes. The company had built a simple, scalable model helping property owners monitor, manage, and monetise car parks using sensors, cameras, and software.

Six months later, the story looks different.

Not because the business has gone backwards. Far from it. Smart Parking has since delivered a strong 1H FY26 result. But the share price has now fallen around 42% from recent all-time highs reached near the beginning of 2026.

For investors willing to look at smaller companies, that kind of pullback can be uncomfortable. It can also be where opportunity starts to reappear.

A strong result, with one important caveat

Smart Parking's 1H FY26 numbers were impressive on the surface.

Revenue increased 96% to $62.6 million. Operating earnings (adjusted EBITDA) rose 85% to $15.6 million. Operating profits (underlying NPATA) jumped 163% to $6.5 million, while statutory net profit after tax rose 10% to $4.3 million.

Adjusted free cash flow also increased 89% to $10.4 million, and the company finished the half with $15.3 million of cash, excluding client funds.

That matters. Many small-cap growth companies can talk about revenue expansion. Fewer can translate growth into meaningful cash generation while still investing for the future.

Operationally, Smart Parking had close to 2000 sites under management, including US-managed sites, and 1,852 global automatic number plate recognition sites, up 19% on the prior corresponding period.

However, investors need to be careful with the headline growth rate.

Smart Parking acquired US-based Peak Parking in February 2025, meaning the latest half included a full six-month contribution from that business. Peak Parking contributed $13.5 million of revenue and $4 million of earnings (adjusted EBITDA).

So, this was not a pure organic doubling story.

That said, Peak Parking appears to be performing well. Its earn-out target was achieved, with the maximum payable in shares, and the acquisition was reported as 30% earnings per share accretive, ahead of the 25% investment case.

Why the US could matter

The US opportunity is arguably the most exciting part of the Smart Parking story.

Broker Shaw and Partners recently highlighted Smart Parking as an ASX small-cap technology company that could have meaningful upside. The broker noted that the company's share price had fallen more than 40% since February despite what it viewed as a solid trading performance.

The broker's positive view appears to centre on Smart Parking's ability to roll out its low-cost parking technology into a large and relatively untapped segment of unmanaged small surface lots attached to retailers, hotels, fast-food chains, and transport hubs.

Smart Parking now has a US platform through Peak Parking. If it can successfully expand its technology-led model across that market, the company could have a much larger runway than its current size suggests.

The risks investors should watch

This is still a small-cap company, and the risks are real.

The UK remains a key profit engine, but parking breach notice volumes were flat in the half. Revenue per parking breach notice rose materially, helped by yield optimisation and improved debt recovery, but margins came under pressure.

Denmark is also a drag, with regulatory changes requiring notices to be physically placed on vehicles, forcing a shift toward manual enforcement. Germany remains in investment mode, and Switzerland is still at a very early stage.

The US opportunity is exciting, but execution is not guaranteed. Scaling in a new market takes time, people, capital, and discipline.

Foolish Takeaway

Smart Parking looks like a better business than its recent share price performance suggests.

The company is growing, generating cash, expanding internationally, and now has a potential platform for US growth. But expectations need to be grounded. The latest result was boosted by Peak Parking, and regulatory and execution risks remain.

Still, after a fall of around 42% from recent highs, Smart Parking looks worth a closer look as a small-cap opportunity for investors comfortable with volatility and patient enough to let the growth story play out.

The post Is this beaten-down ASX small cap a smart opportunity? appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Small-cap investing is rarely smooth.

One month, the market is excited about scale, growth, and opportunity. The next, investors are worrying about dilution, capital raises, and whether management is moving too quickly.

That seems to be the current debate around Stealth Group Holdings Ltd (ASX: SGI).

The ASX small cap has had a wild few months. After reaching all-time highs in January 2026, Stealth shares are now down around 30% from that peak. Yet the share price has also rebounded more than 40% in May alone.

That kind of volatility can be uncomfortable. But it is also fairly stereotypical of smaller-listed companies, particularly those trying to grow quickly through acquisitions and operating leverage.

So, after the pullback and rebound, is Stealth still one of the more interesting ASX small caps to watch?

What does Stealth Group do?

Stealth is a diversified distribution company that supplies products and solutions to businesses, trade customers, and retail consumers across Australia.

It operates across two main divisions: hardware and industrial distribution, and consumer products.

That means the business sits in several practical end markets at once. It supplies hardware, safety, industrial, maintenance, repair, and operations products, while also distributing consumer products and technology accessories through retail channels.

Following its acquisition of Hardware and Building Traders (HBT), Stealth has become a much larger business. HBT added around 1,165 independent stores, approximately $700 million in annual member purchases, and roughly 490 supplier relationships.

The deal also helped position Stealth as a major independent alternative in the hardware and industrial supply market.

That is the strategic attraction here.

Stealth is not trying to reinvent the wheel. It is trying to build scale in fragmented markets, use that scale to improve procurement power, expand exclusive and private-label brands, and drive better margins across a larger platform.

The latest result showed real progress

Stealth's half-year result was strong on the surface.

For the first half of FY26, the company reported gross sales of $82.2 million, up 11.8%. Revenue came in at $72 million, while operating earnings (EBITDA) rose 18.8% to $5.3 million.

Net profit after tax (NPAT) increased 51.4% to $1.6 million.

That is the kind of operating leverage investors like to see. A modest increase in revenue produced a much stronger jump in profit, suggesting the business is beginning to scale.

However, the per-share result tells a more complicated story.

Stealth issued a significant number of shares to help fund the HBT acquisition. That increased the share count materially, meaning existing shareholders absorbed dilution immediately, while the full earnings benefit of HBT will take longer to appear.

This is one of the central tensions in the investment case.

On the one hand, acquisitions can accelerate growth. On the other hand, they can dilute existing shareholders if the new earnings do not arrive quickly enough.

The balance of risk and reward

There are a few clear risks to watch.

The first is dilution. The recent notice of an extraordinary general meeting may have unsettled some investors, particularly the resolution seeking to refresh the company's 15% placement capacity. That does not guarantee another capital raise, but it does remind shareholders that acquisitions and growth funding can come at a cost.

The second risk is execution. Integrating HBT, capturing synergies, expanding private-label brands, and improving margins all sound attractive. But each requires disciplined management.

The third is valuation. Even after falling from its highs, Stealth is no longer an overlooked microcap trading on sleepy expectations. Investors now expect growth.

Foolish Takeaway

Stealth is not a simple story anymore.

It has gone from a small distributor to a much more ambitious national platform with scale, procurement leverage, and a clear FY28 target.

The opportunity is obvious: If management delivers, Stealth could become a far larger and more profitable business.

The risk is equally clear: shareholders need the earnings growth to justify the dilution, the acquisitions, and the volatility.

That makes Stealth one to watch closely rather than blindly chase. For investors who can tolerate small-cap swings, this may be a company worth keeping on the radar as the HBT contribution becomes clearer over the next few reporting periods.

The post Could this rebounding ASX small cap still have a long growth runway? appeared first on The Motley Fool Australia.

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• Why did ASX 200 retail shares outperform last week?

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

For years, the easy answer for Australian investors has been to back the home team. The Vanguard Australian Shares Index ETF (ASX: VAS) has delivered an average annual total return of close to 9% over multiple decades. That is hard to argue with.

However, the ASX has always been thin on technology. 

And right now, the absence of the AI supply chain in our local index is starting to bite.

That gap is exactly what some investors have been quietly closing.

A 12-month run that nobody expected

The iShares MSCI South Korea ETF (ASX: IKO) has rallied more than 196% over the past 12 months. The pace has not slowed either – the share price continues to push to fresh record highs as the South Korean share market rips through milestone after milestone.

On Monday, the South Korean benchmark KOSPI surged 4.32% to close at a record 7,822.24 points, its fifth consecutive record high. The broader Korean share market capitalisation crossed 7,000 trillion won (around US$4.75 trillion) for the first time. Five months earlier, that figure sat at 4,000 trillion won.

This is not a small repricing. It is a total rerating of an entire share market.

Memory chips are doing the heavy lifting

Look under the hood and the story becomes obvious. The IKO ETF is heavily concentrated in two companies. SK Hynix accounts for roughly 26% of the fund. Samsung Electronics is another 24%. Together, they are nearly half the portfolio.

Both are memory chip giants. SK Hynix and Samsung control more than 70% of the global DRAM market between them, and Samsung leads the world in NAND flash production. These are the building blocks behind every AI server, every data centre, every cloud platform being constructed at speed right now.

Korean chip exports surged nearly 150% year over year in the first 10 days of May to a record US$8.54 billion.

Another large holding within IKO is Hanwha Aerospace, which makes turbine engines, defence systems, and the surface mount equipment that puts chips onto circuit boards. Industrials, financials, and Hyundai-linked auto stocks make up most of the rest.

In other words – IKO is, in disguise, a leveraged play on the AI build-out and Korea's broader industrial revival.

Valuations were the spark

The other reason capital has poured in is straightforward. Korean tech was relatively "cheap".

While US mega-cap tech has commanded premium multiples through 2024 and 2025, Samsung and SK Hynix traded at single-digit and low-double-digit forward earnings multiples even after this run began. That valuation gap drew global investors searching for cheaper exposure to the same AI thematic that has powered Wall Street to new highs.

Japan has seen a similar phenomenon with the Nikkei. The pattern is consistent. Investors are looking for AI exposure without paying Silicon Valley prices.

A weaker Korean won has also lifted the competitiveness of Korean exporters. That helps earnings, even if it slightly mutes the AUD-denominated returns for Australian holders of IKO.

Foolish takeaway

The risks here are not invisible. The IKO ETF is concentrated. Around half of it sits in semiconductors, and the chart has gone close to parabolic. A pullback in memory pricing, a tariff shock, or a broader AI investment slowdown could hit this fund harder than most.

But step back from this one fund and the bigger point becomes clear. The ASX is a wonderful starting point for any Australian portfolio – the dividends, the franking credits, the familiar names. It also happens to be light on the structural growth themes shaping the next decade. Semiconductors. AI infrastructure. Advanced manufacturing. Defence technology. Very little of it is investable through local shares alone.

Looking offshore is one way to bridge that gap. Korea is one option. Japan is another. The US and parts of Europe each offer their own slice of growth that simply does not exist in our own backyard.

Predicting whether IKO continues its run from here or reverses would be folly. The more durable takeaway is that the themes driving global markets are not always available at home – and the investors willing to look further afield often find the returns that prove it.

The post After surging nearly 200%, is this the best ASX ETF in 2026? appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Most people will never run a business. But that doesn't mean they can't own one — or several hundred.

The share market exists precisely for this purpose. It lets ordinary investors become silent owners of real businesses generating real cash flow, without needing to manage staff, chase invoices, or sit through board meetings.

Income-focused exchange-traded funds (ETFs) take this idea one step further. Rather than doing the homework on individual companies, the fund does it for you — bundling dozens of dividend-paying businesses into a single holding that pays out distributions at regular intervals.

The question most investors never quite get around to answering is: How do I actually build this kind of income stream if I don't have a lump sum sitting ready to deploy?

That's where dollar-cost averaging comes in.

The quiet power of regular contributions

Dollar-cost averaging — or DCA — is the practice of investing a fixed dollar amount at regular intervals, regardless of what the market is doing. When prices fall, your contribution buys more units. When prices rise, it buys fewer. Over time, this tends to smooth out the average cost of your investment.

It's not a strategy designed to maximise returns. It's designed to maximise discipline.

For most Australians building wealth around a salary, DCA reflects reality anyway. You earn, you save, you invest — consistently and repeatedly. The structure simply puts intention behind what would otherwise be an ad hoc process.

Applied to income-producing ETFs, dollar-cost averaging creates something compounding and structural over time: a growing portfolio that throws off increasing distributions each year, without requiring you to make active calls on markets or individual companies.

3 income ETFs worth considering

The Vanguard Australian Shares High Yield ETF (ASX: VHY) is the obvious starting point. With nearly $7 billion in funds under management, it is the largest dedicated income ETF in Australia. The VHY ETF tracks the FTSE Australia High Dividend Yield Index, holding 79 companies, including names such as BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), and Telstra Group Ltd (ASX: TLS). Its approximate dividend yield sits at 4.3%, and its management fee of 0.25% keeps costs reasonable. For a regular investor building toward income, VHY is a sensible core holding.

For those seeking a global income layer, the SPDR S&P Global Dividend Fund (ASX: WDIV) offers exposure to 97 high-yielding companies across international markets, yielding approximately 5.2% and charging a fee of 0.35%. Adding WDIV alongside a domestic holding reduces concentration in Australian banks and resources, sectors that dominate the local income landscape.

Investors looking for a lower-cost domestic option might also consider the iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD), which carries a management fee of 0.23% and delivered a one-year total return (dividends and capital gains) of over 23%. IHD applies an ESG screen, meaning it excludes companies that don't meet certain environmental, social, and governance criteria.

Foolish Takeaway

The goal of dollar-cost averaging into income ETFs is not to get rich overnight. It is to build a machine — slowly, methodically — that generates cash flow from businesses you own but never have to run.

In the early stages, reinvesting distributions accelerates the compounding. As the portfolio grows, those same distributions can become income you actually spend.

No strategy removes market risk entirely, and ETF distributions are not guaranteed to remain constant year to year. But for investors who want exposure to the income-generating capacity of Australian and global businesses without the active management burden, a regular contribution plan into a small basket of income ETFs is one of the most straightforward approaches available.

The best time to start is usually before you feel ready.

The post How to dollar-cost average your way to passive income with ETFs appeared first on The Motley Fool Australia.

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• An easy 2 ASX ETF portfolio to fund retirement 

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned.  The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended BHP Group and Vanguard Australian Shares High Yield ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There is a different kind of pressure that arrives in your mid-50s.

At 45, retirement can still feel distant. At 50, it starts becoming real. But by 55, the question becomes far more personal.

Have I done enough?

It is not just a question of whether you can retire. It is whether you can retire comfortably, with enough financial breathing room to enjoy the next chapter without constantly worrying about money.

So, could the average Australian 55-year-old comfortably retire in 2026?

The answer is probably not yet. However, that does not mean the opportunity has passed.

What does the average 55-year-old have in super?

According to figures cited by the Association of Superannuation Funds of Australia (ASFA), the average superannuation balance for men aged 55 to 59 is $319,743. For women in the same age bracket, the average is $242,945.

That puts many Australians in their mid-to-late 50s somewhere around the high-$200,000s to low-$300,000s.

That is a meaningful pool of retirement savings.

It is also a long way short of what ASFA estimates is needed for a comfortable retirement. ASFA's comfortable retirement standard assumes a good standard of living, including private health insurance, regular leisure activities, occasional meals out, a reasonable car, some domestic travel, and the ability to handle home repairs.

To fund that lifestyle, ASFA estimates a single person needs around $54,840 per year, while a couple needs roughly $77,375 per year. The suggested lump sum is about $630,000 for singles and $730,000 for couples, assuming home ownership and some Age Pension support later in retirement.

On those numbers, the average 55-year-old is not yet sitting in obvious "comfortable retirement" territory.

The gap is real, but the window is still open

For a single person with around $280,000 to $320,000 in super, the gap to the comfortable retirement benchmark could still be several hundred thousand dollars.

That sounds confronting.

But age 55 is not age 65.

For many Australians, there may still be a decade of work, contributions, investment returns, and planning ahead. That decade can make a major difference.

This is where the conversation should shift.

The question is not only: "Can I retire now?"

The better question may be: "What could my retirement look like if I invested well, contributed consistently, and used the next 10 years properly?"

That is a much more optimistic frame.

A 55-year-old with a solid balance, continued employer super contributions, possible salary sacrifice contributions, and a sensibly invested portfolio still has time to improve the outcome.

Retiring at 55 has another problem

There is also a practical issue.

At 55, most Australians cannot simply start living off their super. Age 60 is generally the key preservation age for many Australians who have stopped working, while unrestricted access generally begins at 65. Age Pension eligibility starts at 67, subject to the relevant tests.

That means retiring at 55 usually requires other assets, cash, investments, or income to bridge the gap before super becomes accessible.

And that bridge matters.

A person retiring at 55 is not just retiring early. They are asking their money to last longer, while potentially giving up some of the highest-earning and highest-contributing years of their working life.

That is a big trade-off.

Your late 50s could be your strongest retirement-building decade

This is the part that can be missed.

Your late 50s can be one of the most powerful periods for building retirement wealth.

Income may still be strong. The mortgage may be smaller than it once was. Children may be more independent. And the super balance itself is finally large enough that investment returns can start to matter in bigger dollar terms.

For example, a 7% return on a $300,000 super balance is $21,000 before new contributions are added.

That does not mean markets will deliver smooth returns every year. They will not. But it does show why investment allocation still matters.

Becoming too conservative too early can be costly. At 55, many people may still have 10 years before retirement and potentially 30 or more years of retirement ahead of them. That is a long investment horizon.

Foolish Takeaway

The average superannuation balance of a 55-year-old in 2026 is probably not enough to retire comfortably today.

For many Australians, 55 is not the end of the journey. It is the beginning of the most important stretch.

The next decade may be about investing well, contributing where possible, managing risk sensibly, and preparing for a smoother transition into retirement.

Retiring comfortably is not just about hitting one number. It is about building enough flexibility to handle markets, inflation, healthcare costs, lifestyle choices, and the unexpected.

At 55, the runway is shorter than it used to be.

But for those who use it well, it may still be long enough to make a very meaningful difference.

The post Is the average superannuation balance of a 55-year-old enough to retire well in 2026? appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• 3 ASX stocks that look like classic Warren Buffett investments
• 3 quality ASX ETFs to buy and hold until 2036
• Buying ASX 200 bank stocks like Westpac and CBA shares? Here's why these funds are betting against you
• Why did ASX 200 retail shares outperform last week?

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Some of the best share market returns come not from drama, but from patience. Not from chasing headlines, but from holding steady while a well-run business quietly compounds.

That is the story Mader Group Ltd (ASX: MAD) has been writing for the past five years — and the next chapter may be just as interesting.

A five-year run most investors missed

Mader is not a household name. It does not appear in the S&P/ASX 200 Index (ASX: XJO). It does not benefit from analyst coverage on every broker desk. What it does have is a clear, repeatable business model: deploying highly skilled technicians to maintain and repair heavy mobile equipment for mining and energy clients across Australia, North America, and beyond.

That asset-light, people-first model has driven a share price return of more than 700% over the past five years — outperforming the ASX 200 by a wide margin. Investors who backed Mader early have more than eight times their original capital, not counting dividends received along the way.

That kind of performance is rare. It does not happen by accident.

The sideways stretch 

Since September 2025, the share price has largely marked time. For investors watching the ticker, this can feel frustrating. For long-term holders, it may simply be a pause.

Mader's first-half FY26 result showed net profit after tax of $30.5 million, up 17% on the prior corresponding period. Revenue continued to track higher across its Australian and North American divisions, reflecting sustained demand for maintenance services. On the face of it, the business is still growing.

The headline surprise came elsewhere. Management chose not to declare an interim dividend, opting instead to accelerate the company's pathway to a net cash position. The stated goal: strengthen the balance sheet before pursuing a more aggressive approach to organic and inorganic growth opportunities.

Markets reacted. Mader shares fell sharply on the day of the result before clawing back most of those losses. That intraday reversal is worth noting. Cooler heads, on reflection, appeared to separate the dividend decision from what the business itself was actually doing.

Deferring a dividend to reduce debt is not the same as cutting it because earnings are falling. Capital allocation decisions and operational performance are different conversations.

The case for patience now

Broker Bell Potter sees value in Mader at current levels. Following the half-year result, the broker upgraded the shares to a buy rating with a price target of $9.70, implying potential upside of around 23% at time of writing.

The reasoning: North America and Australia profitability is expected to improve in the second half of FY26 as revenue lifts faster than the respective cost bases. 

Labour recruitment and deployment remain the primary constraint on faster growth, particularly in North America. That is a real risk. Execution risk also exists when companies pursue both organic expansion and acquisitions simultaneously.

But Mader has navigated this balance before. Its workforce model is built around culture and retention, which has historically supported contract wins and margin performance. The shift toward net cash would also give management considerably more firepower when the right acquisition opportunity presents itself.

The Foolish takeaway

Five years ago, Mader was a small, under-the-radar mining services company. Today it is a diversified, internationally expanding business with a strong track record and a deliberate growth strategy. The share price reflects that journey — but the sideways drift since September 2025 suggests the market is still in a wait-and-see posture.

If profits continue to grow and the balance sheet strengthens as management expects, that posture may not last. As with the best long-term compounders, the reward for patience can arrive quietly — and quickly. The key risk is that execution in North America and on the acquisition front falls short of expectations. For investors with a long enough horizon, Mader remains one of the more intriguing stories on the ASX.

The post Mader Group shares are up 700% in 5 years. Is patience about to pay off again? appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• 3 ASX stocks that look like classic Warren Buffett investments
• 3 quality ASX ETFs to buy and hold until 2036
• Buying ASX 200 bank stocks like Westpac and CBA shares? Here's why these funds are betting against you
• Why did ASX 200 retail shares outperform last week?

Motley Fool contributor Leigh Gant owns shares in Mader Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Mader Group. The Motley Fool Australia has positions in and has recommended Mader Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Every veteran investor knows markets crash. The question is never whether it will happen. It is whether there is a plan ready for when it does.

History is clear on this point. The share market's biggest single-day and weekly gains have almost always followed its worst periods. Investors who panic-sold in March 2020, in the 2022 rate shock, or during the GFC did not just lock in losses — they missed the recoveries that followed. Those recoveries have been among the greatest wealth-creation events of a lifetime.

So if the S&P/ASX 200 Index (ASX: XJO) fell 20% from here, what might a prepared investor actually do?

Buy. Deliberately. With a list already prepared.

Save like a pessimist, invest like an optimist

One framework worth considering starts well before a crash arrives. Keeping a cash buffer — not out of fear, but out of preparation — creates "dry powder". It is what allows an investor to lean into fear when others are running from it.

When the drop comes, the goal is not to pick the exact bottom. That is a fool's (small "f"!) errand. The aim is simply to be in the market when it recovers. Perfect positioning is not required. Participation is.

The core of a sensible crash-buying approach is broad, low-cost index exposure to the two most important share markets in the world.

For Australia, the Vanguard Australian Shares Index ETF (ASX: VAS) tracks the 300 largest companies on the ASX. Banks, miners, healthcare, consumer staples — all in one basket. When the market is down 20%, the case for owning the whole market rather than trying to pick survivors becomes even stronger.

For the United States, the iShares S&P 500 ETF (ASX: IVV) offers unhedged S&P 500 exposure, while the iShares S&P 500 AUD Hedged ETF (ASX: IHVV) removes currency noise for investors who prefer not to carry AUD/USD risk.

Together, VAS and either the IVV or IHVV ETF can form the core of a portfolio: stable, diversified, and built to survive almost anything.

The satellite: growth where it matters most

A core-only portfolio is robust, but not particularly positioned for growth. That is where a satellite allocation can earn its place.

The focus here is not on chasing every trend. The more compelling case is for two structural shifts that look likely to reshape the global economy over the next decade: robotics and AI infrastructure.

The Betashares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ) provides exposure to companies developing and deploying robotics and AI — from industrial automation to unmanned systems. When markets fall broadly, quality companies in transformational sectors often fall just as hard as everything else. That is the potential entry point.

The other satellite worth watching is the Global X Artificial Intelligence Infrastructure ETF (ASX: AINF). While most attention focuses on the software and chip layer of AI, AINF sits beneath all of that — in the energy systems, data infrastructure, and materials that make AI physically possible. Global data centre spending is expected to exceed US$2 trillion over the next five years. That is not a trend. That is a building site.

A core-satellite approach does not mean splitting things equally. The core should represent the bulk of any position — perhaps 70–80% — with satellite ETFs taking a smaller, higher-conviction slice.

The Foolish takeaway

A 20% market crash would be uncomfortable. It always is. But discomfort and danger are not the same thing for a long-term investor with a prepared portfolio and cash ready to deploy.

The investors who tend to build real wealth are rarely the ones with the cleverest trades. They are the ones who stayed calm, kept buying, and let the market do its work over time. Having a watchlist of ETFs ready before the market falls is how that patience gets put to work.

The post All-weather ASX ETFs to buy if the market crashes 20% appeared first on The Motley Fool Australia.

More reading

• 3 quality ASX ETFs to buy and hold until 2036
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• What $500 a month in ASX ETFs looks like in 10 years
• 2 ASX ETFs positioned for the booming AI data centre buildout
• Buying the Vanguard Australian Shares ETF (VAS)? There's a big change you should know about

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended iShares S&P 500 ETF. The Motley Fool Australia has recommended iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There is a retirement decision many Australians make in their 50s and early 60s that feels sensible, cautious, and responsible.

It can also be one of the most expensive mistakes in long-term wealth building.

The idea sounds reasonable enough: as retirement gets closer, shift your super into cash or a conservative option so you can protect what you have built. After all, if markets fall, you have less time to recover.

That is the part that makes the decision feel smart.

The problem is that safety and lower returns often travel together. And over the final stretch before retirement, that trade-off can become far more costly than people expect.

What actually hurts returns

The biggest damage usually does not come from a market fall on its own.

It comes from what happens next.

When investors switch to cash after markets have already fallen, they often lock in the decline. Then, because confidence usually returns slowly, many stay defensive while markets recover. That means they can miss part of the rebound, which is often where a large share of long-term returns is earned.

That is the trap.

Market downturns feel dangerous in the moment. Yet for long-term investors, the bigger risk is often responding emotionally and giving up years of future compounding.

Why the final decade matters so much

One of the most misunderstood parts of retirement planning is how powerful the last 10 years before retirement can be.

By that stage, many people have built meaningful super balances. Even modest percentage returns on a larger base can add up quickly. That means the final decade is not just about preservation. It is still a major growth phase.

For example, a $400,000 super balance growing at 9% a year for 10 years would become roughly $947,000, even without extra contributions.

If that same balance grew at 4% a year instead, it would reach about $592,000.

That is a gap of more than $350,000.

This is why moving to low-growth settings too early can have such a lasting impact. It is not simply about avoiding losses. It is about what you give up in return.

The market downturn can make this decision more dangerous

A falling market often creates the strongest urge to "play it safe".

That is understandable. Watching your super balance decline can be uncomfortable, especially when retirement no longer feels far away.

Yet this is exactly when a rushed switch can do the most harm.

If markets are already down, moving to cash may protect you from further short-term falls, but it can also leave you stranded if prices recover sooner than expected. And recoveries rarely wait until investors feel calm again.

In other words, the danger is not just volatility. The danger is making a permanent portfolio decision based on a temporary emotional state.

A downturn does not automatically mean your super strategy is wrong. It may simply mean markets are doing what markets have always done from time to time.

What to focus on instead

That does not mean everyone should stay aggressively invested forever.

Your investment mix should reflect your age, expected retirement date, need for income, other assets, and ability to tolerate fluctuations. There is no one-size-fits-all answer.

However, a change this important should be based on your full financial position, not a scary patch in the headlines.

For many Australians, better questions to ask are:

How much growth do I still need?

How long until I start drawing heavily on my super?

Will I retire all at once, or transition gradually?

Do I have cash or other assets outside super that reduce the need to panic?

Those questions are far more useful than simply asking whether cash feels safer today.

Foolish Takeaway

The myth is not that cash is always bad. It is that conservative automatically means safer.

In reality, switching your super to cash or a low-growth option too early can reduce your long-term retirement outcome by far more than many people realise. Not because you made a reckless decision, but because the decision felt prudent at exactly the wrong time.

Super is still a long-term investment vehicle, even as retirement gets closer.

If you are thinking about changing your investment option, make sure the move fits your timeline and broader plan, not just your nerves on a volatile day.

The post The superannuation myth that could cost you $100,000 before you retire appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• 3 ASX stocks that look like classic Warren Buffett investments
• 3 quality ASX ETFs to buy and hold until 2036
• Buying ASX 200 bank stocks like Westpac and CBA shares? Here's why these funds are betting against you
• Why did ASX 200 retail shares outperform last week?

Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips

When geopolitical risk collides with tight global energy supply, investors tend to reach for the same playbook. 

Buy the producers. Buy them quickly.

That is precisely what has happened so far in 2026. And few ASX 200 names have benefited more than Woodside Energy Group Ltd (ASX: WDS).

The Woodside share price has climbed more than 40% since the start of the year. For context, the broader S&P/ASX 200 Index (ASX: XJO) has gained roughly 2–3% over the same period. 

The gap tells its own story.

The Iran premium and what it means

The rally was triggered by the rapid escalation in the US–Iran conflict in late February, which threatened shipping flows through the Strait of Hormuz — one of the world's most critical oil transit corridors.

Brent crude, which closed 2025 below US$65 per barrel, surged past US$100 quickly, then has been on a rollercoaster in the weeks that have followed. Failed peace talks, combined with a US announcement of a blockade on vessels using Iranian ports, have continued to keep the crude near highs.

Woodside has no operations in the affected region. That matters. It means the company collects the higher oil and LNG price benefit with no direct operational exposure to the conflict. Supply disruption elsewhere is essentially a windfall.

This is the kind of asymmetric positioning that generates outsized share price returns in a short period of time. It is also the kind of positioning that makes forward-looking investors nervous about what happens when the premium fades.

More than just oil prices

The easy narrative is that Woodside is simply riding the oil price. But the underlying business has actually strengthened.

In its full-year 2025 result, Woodside reported record annual production of 198.8 million barrels of oil equivalent, topping its own guidance. Costs fell 4% over the year. Its Louisiana LNG project in the United States — a significant future growth engine — was confirmed as on schedule and on budget following an investor site visit earlier this year.

Woodside's new Managing Director and CEO Liz Westcott, who was permanently appointed earlier in 2026, has reaffirmed the company's growth strategy, with a focus on project execution and shareholder value creation. That kind of continuity matters when a business is in the middle of a major capital programme.

On the income side, Woodside offers a dividend yield of over 5% at the time of writing, fully franked. 

Foolish takeaway

The real question is not whether Woodside deserves to be higher than it was in January. It almost certainly does. The harder question is how much of the 40%-plus move reflects a stronger business, and how much reflects a market still pricing in geopolitical stress.

Strip out the Iran premium and the oil price spike, and Woodside still looks like a business that was improving anyway. Record production, lower costs, a major growth project staying on track, and a new CEO with a clear mandate all point to a company with more going on than a simple commodity rally.

At the same time, it would be naïve to ignore how much of the recent share price strength has come from forces outside Woodside's control. The path of Brent crude, the direction of Middle East tensions, and the mood of the market can all shift quickly. If oil prices normalise, Woodside shares may well give back some of this year's gains.

That is the trade-off with energy stocks. They can offer powerful earnings leverage when the cycle is moving your way, but they rarely move in a straight line.

So perhaps the better lens is not asking whether Woodside is cheap or expensive based only on today's oil price. It is asking what kind of business sits underneath the volatility, and whether that business is becoming more resilient, more productive, and better positioned for the next few years than it was before this rally began.

On that front, the case still looks interesting. The commodity risk is real, and position sizing matters. Even so, if the geopolitical premium eventually fades, Woodside may still be left with something more durable: a stronger operating base, visible project momentum, and a business that could remain worth watching long after the headlines cool.

The post Why the Woodside share price has climbed 40% in 2026 appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Markets don't fall in a straight line. They lurch, recover, lurch again — and right now, with geopolitical tensions between Iran and the United States keeping energy prices volatile and inflation expectations unsettled, the S&P/ASX 200 Index (ASX: XJO) is doing exactly that.

For long-term investors, this kind of volatility isn't a threat. It's a calendar.

A 10% pullback from current ASX 200 levels wouldn't be unusual by historical standards. 

What matters more is what you'd do with it. Rather than reaching for a broad ETF, I'd be looking at two specific companies that I think deserve a spot in a quality portfolio — and that would become even more compelling at lower prices.

The case for Soul Patts

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) is one of Australia's oldest listed investment companies, but it operates more like a quietly compounding private holding company than a traditional fund manager.

Soul Patts gives investors exposure to a carefully managed mix of assets: resources, telecommunications, nationwide swimming schools, agriculture, water entitlements, electrification, and more. It recently completed its full merger with Brickworks and has been actively reshaping its portfolio — most notably, selling down its long-held stake in TPG Telecom Ltd (ASX: TPG) to free up capital for higher-growth opportunities.

That capital reallocation is the interesting part. Soul Patts isn't sitting still. The proceeds from the TPG selldown give management fresh firepower to deploy into assets it believes will deliver stronger long-term growth. For a patient investor, that's exactly what you want to see — disciplined capital allocation, not loyalty to underperforming positions.

At time of writing, the Soul Patts share price is currently around $42.30. A 10% market-wide pullback might push the share price even lower, but the underlying value and fundamentals of the Sol Patts' underlying businesses wouldn't change materially. That's the gap a long-term buyer could exploit.

Why Pinnacle is worth watching

Pinnacle Investment Management Group Ltd (ASX: PNI) is a different kind of business but a similarly compelling structural story.

Pinnacle runs a network of affiliated fund managers, providing them with seed capital, distribution support, and operational infrastructure. It earns revenue from management fees and a share of affiliate profits — a model that scales well as funds under management grow.

In its most recent half-year results, Pinnacle reported record net inflows of $17.2 billion, with strong contributions across retail, institutional, and international channels. That's a business attracting capital, not losing it.

The Pinnacle share price has pulled back sharply from its 52-week high of $25.33 to around $12.30, and the stock carries an analyst price target of around $24. That's a meaningful gap between where the share price is and where analysts believe it could be.

A broader market sell-off would likely push Pinnacle lower in the near term. But for an investor with a long time horizon, that volatility is a feature, not a flaw.

The Foolish takeaway

Neither of these companies needs a market crash to be worth owning. Both are genuinely interesting at today's prices. But the point of having a watchlist is knowing exactly what you'd do when prices move — and a further 10% dip in the ASX 200 could see individual stocks like Soul Patts and Pinnacle fall further still, putting them within reach of entry prices that are difficult to walk away from.

As always, share prices can fall further than expected, and volatility driven by macro events — energy prices, rate expectations, geopolitical uncertainty — can linger longer than most anticipate. However, quality doesn't go on sale forever. 

When it does, it pays to be ready.

The post 2 quality ASX 200 shares I'd buy if the market fell another 10% appeared first on The Motley Fool Australia.

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• 3 ASX dividend shares raising dividends like clockwork
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Motley Fool contributor Leigh Gant has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Pinnacle Investment Management Group and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Pinnacle Investment Management Group and Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.