It's true that investing is a complicated process, with strange apps or websites to navigate, unfamiliar jargon to get one's head around, and money to part with. However, the rewards are so compelling that I think it is essential that Australians who can invest do so, for the sake of their own financial futures.

So with that in mind, let's talk about three ASX shares that I think would make for a perfect pick for a beginner investor today. These ASX shares are all inherently diversified and have a decent track record of delivering real returns for investors over many years – two factors I think are essential for a first investment.

3 ASX shares perfect for beginners

Vanguard Australian Shares Index ETF (ASX: VAS)

First up, we have the ASX's most popular index fund. Like all index funds, this ETF from Vanguard holds every share in an index. In this case, that's the S&P/ASX 300 Index (ASX: XKO). In effect, this means that VAS holds a small portion of all 300 of the largest companies listed on the Australian share market. That's everything from Commonwealth Bank of Australia (ASX: CBA) and Telstra Group Ltd (ASX: TLS) to Ampol Ltd (ASX: ALD) and JB Hi-Fi Ltd (ASX: JBH).

This makes the Vanguard Australian Shares ETF a bet of sorts on the future of the Australian economy as a whole. That has always worked out well for investors in the past.

Argo Investments Ltd (ASX: ARG)

Next up, we have a listed investment company (LIC) in Argo. LICs are companies that own and manage a portfolio of underlying investments on behalf of their investors. Argo has been doing this for decades, managing a collection of some of Australia's best blue-chip stocks. Those ASX shares include CBA and Telstra, as well as Woolworths Group Ltd (ASX: WOW), BHP Group Ltd (ASX: BHP), and Bunnings-owner Wesfarmers Ltd (ASX: WES).

Argo has delivered market-matching returns for decades, and also pays a decent dividend, which usually comes with full franking credits attached.

iShares S&P 500 ETF (ASX: IVV)

Our last stock for a beginner investor today is not really an ASX share. It is another index fund, but this one doesn't hold CBA, Woolies, or Telstra. Instead, it tracks the S&P 500 Index (SP: .INX). This index represents the largest 500 stocks listed on the American markets, just as VAS represents Australia's largest 300 companies. So instead of JB Hi-Fi and Wesfarmers, you are getting exposure to the likes of Apple, Microsoft, Amazon, Coca-Cola, and Netflix.

The US is unquestionably home to many of the world's best businesses. As such, I think it is a mistake for any Australian investor to just stick with our local companies. This index fund is an easy and effective way to add some of the world's best companies to your portfolio.

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When valuations appear full, it can be a good time for investors to consider generating passive income through dividend shares. 

Dividend shares can bring steady passive income should markets correct or stay flat. 

Here are three options to consider with healthy yields right now. 

Argo Investments Ltd (ASX: ARG)

Argo is a listed investment company (LIC) with a diversified portfolio of more than 90 ASX-listed companies. 

It has a healthy track record of consistent dividends dating back more than 20 years. 

This aligns with its ethos, as it aims to provide shareholders with long-term growth as well as reliable dividend income.

Argo released its half-year results to 31 December 2025 on Monday. 

The announcement included an interim dividend worth 18.5 cents per share for the first half of FY2026.

As Sebastian Bowen reported on Monday, this is a record high interim dividend for the company. 

It's important to note the ex-dividend date for this payout has been set for this Friday, 13 February.

This means you need to have bought Argo shares by market close on Thursday to qualify for the payment. 

The updated interim dividend means these ASX dividend shares now give the company a forward dividend yield of roughly 4.2%.

CAR Group Ltd (ASX: CAR)

Car Group is another ASX dividend stock that announced positive news for investors this week. 

On Monday, the company also released half-year results, which included a bumped up dividend payment. 

Car Group announced its next interim dividend will be 42.5 cents per share.

This is a significant jump from the interim dividend of 38.5 cents per share that investors saw last year.

The stock now has a forward dividend yield of 3.16%.

While 3.16% isn't the best yield on the market, it's the consistency of passive income that might attract investors. 

As far as dividend shares go, Car Group has now put together 10 years of consistent increases. 

Qantas Airways Ltd (ASX: QAN)

Qantas is one of Australia's most recognisable ASX dividend shares. 

New data from UBS has projected a cash dividend yield of almost 5% in 2026 including the franking credits.

Macquarie also expects Qantas to deliver a dividend yield of around 5% in FY26.

This is expected alongside further share price gains, which could bring the magical combination of capital gains and passive income. 

Its dividend is also expected to continue to grow through 2030, giving these ASX dividend shares strong long term potential. 

Qantas will release its half-year results on February 26.

The post 3 of the best ASX dividend shares right now appeared first on The Motley Fool Australia.

Ever since, Argo has painstakingly built up a reputation as a conservative steward of investor capital, investing its shareholders' money in blue-chip ASX investments.

With many shareholders across the country entrusting Argo with their capital, there would have been more than a few eyes on this LIC's latest financial results, unveiled this morning.

As we covered at the time, Argo had some decent numbers to show off for its half year ending 31 December 2025.

The company brought in a profit of $130.8 million, up 7.9% from the $121.2 million recorded for the same period in 2024. In some good news for investors, this enabled Argo to reduce its management expense ratio from 0.15% per annum to 0.14%.

Investors are reacting positively this session, with the Argo share price currently up a healthy 1.44% to $9.15 (at the time of writing).

But let's talk about dividends.

Argo shares unveil record interim dividend

One of the most exciting bits of news in today's earnings was undoubtedly the new dividend that was revealed. Argo has elected to fund an interim dividend worth 18.5 cents per share for the first half of FY2026. As is Argo's habit, this dividend will come with full franking credits attached.

This 18.5-cent payout will be the largest interim dividend Argo has ever paid, exceeding last year's 17 cents per share interim dividend by 8.8%.

Together with last September's final dividend, worth 20 cents per share, this will take Argo's 12-month dividend total to 38.5 cents per share.

This latest interim dividend from Argo will be sent to shareholders on 20 March next month. For investors who don't yet own Argo shares but might wish to get a slice of this action, the ex-dividend date for this payout has been set for this Friday, 13 February. That means investors will need to have bought shares by market close on Thursday if they wish to bag a payment.

Argo is also offering a dividend reinvestment plan (DRP). If shareholders so choose, they can opt to receive this dividend as additional Argo shares rather than cash. The cutoff to nominate for the DRP is 17 February next week.

Argo shares currently trade on a trailing dividend yield of 4.04%. However, this new dividend will give the company a forward dividend yield of 4.21%.

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What did Argo Investments Limited report?

• Half-year profit: $130.8 million, up from $121.2 million last year
• Earnings per share: 17.2 cents, up from 15.9 cents
• Interim dividend: 18.5 cents per share (fully franked), up 8.8%
• Management expense ratio: 0.14%, improved from 0.15%
• Grossed-up annual yield: 6.1% based on the last closing share price

What else do investors need to know?

Argo's investment revenue from its portfolio was flat over the half, but profit was lifted by trading and options income. The company has boosted its fully franked dividend by 37.5% over the past five years, maintaining 100% franking even throughout volatile market conditions.

During the period, Argo made some notable investment changes, adding CSL Ltd (ASX: CSL), Amcor (ASX: AMC), Worley Ltd (ASX: WOR), Rio Tinto Ltd (ASX: RIO), BHP Group Ltd (ASX:BHP) , Generation Development Group Ltd (ASX: GDG), and Clarity Pharmaceuticals Ltd (ASX: CU6), while selling all shares in Healius Ltd (ASX: HLS) and GPT Group (ASX: GPT). The total number of portfolio stocks decreased slightly from 85 to 83.

What did Argo Investments management say?

Managing Director Jason Beddow said:

We considered it appropriate to meaningfully increase the interim dividend. The Board is committed to sustainably growing Argo's fully franked dividends.

What's next for Argo Investments?

Looking ahead, Argo noted the outlook remains highly uncertain given ongoing geopolitical risks and shifting monetary policy, including higher Australian interest rates. The team highlighted Australia's structural advantages, particularly in resources and critical minerals.

Argo plans to keep its diversified approach, spanning more than 80 ASX-listed companies. The company says it aims to provide shareholders with reliable income and long-term capital growth, even through volatile markets.

Argo Investments share price snapshot

Over the past 12 months, Argo Investments shares have risen 1%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 3% over the same period.

View Original Announcement

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The S&P/ASX 200 Index (ASX: XJO) closed 1.81% lower at 8,708.8 points as earnings season got underway.

The week began with a commodities rout that pummelled ASX 200 mining shares.

Investors took profits as metals, particularly gold and silver, plunged on news of the US President's Fed chair pick.

On Tuesday, a 0.25% interest rate hike in Australia benefitted the ASX 200 financial sector but created pain for tech.

ASX 200 tech shares fell almost 12% last week. The sector is now down almost 20% in the year to date.

Out of the 11 market sectors, only two finished the week in the green.

Let's review.

Financial shares led the ASX sectors last week

Share price performance varied across the ASX 200 financial sector, which incorporates bank shares, insurers, fund managers, and more.

The Commonwealth Bank of Australia (ASX: CBA) share price soared 6.39% to finish at $158.91 on Friday.

CBA will reveal its 1H FY26 results on Wednesday.

Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares closed the week at $37.01, up 0.84%.

Westpac Banking Corp (ASX: WBC) shares ascended 1.57% to $39.43.

National Australia Bank Ltd (ASX: NAB) shares fell 0.02% to $43.36.

The Macquarie Group Ltd (ASX: MQG) share price lost 2.05% to close at $207.83.

Among the investment companies and fund managers, Washington H. Soul Pattinson and Co Ltd (ASX: SOL) shares fell 4.09% to $37.01.

GQG Partners Inc (ASX: GQG) shares rose 7.96% to $1.70.

Shares in Argo Investments Ltd (ASX: ARG), which reports on Monday, descended 0.77% to $9.02 apiece.

Among the financial services providers, AMP Ltd (ASX: AMP) shares fell 2.94% to $1.65.

AMP will release its 1H FY26 results on Thursday.

The Challenger Ltd (ASX: CGF) share price dropped 3.15% to $8.92.

Buy now, pay later share Zip Co Ltd (ASX: ZIP) fell 10.19% to $2.38.

Among the ASX 200 insurers, Medibank Private Ltd (ASX: MPL) shares fell 1.08% to $4.57.

The QBE Insurance Group Ltd (ASX: QBE) share price ascended 2.23% to $20.18.

Insurance Australia Group Ltd (ASX: IAG) shares rose 1.71% to $7.73.

IAG will release its 1H FY26 results on Thursday.

See our earnings calendar to find out when the companies you're invested in will announce their dividends.

ASX 200 market sector snapshot

Here's how the 11 market sectors stacked up last week, according to CommSec data.

Over the five trading days:

The post ASX 200 financials flew but tech and mining shares faltered last week appeared first on The Motley Fool Australia.

Choosing those shares is the hard part, of course. With so many options on the ASX alone, it can be overwhelming to sift through the wheat to find the proverbial chaff.

To make things easier, I've concocted a simple, three-stock ASX share portfolio that I think any investor, beginner or veteran, can construct with confidence if they are hoping to build long-term wealth.

A simple ASX stock portfolio for building wealth

First up, investors can consider investing in Argo Investments Ltd (ASX: ARG). Argo is a listed investment company (LIC). This means it holds an underlying portfolio of investments, which the company manages on behalf of its shareholders. In Argo's case, these underlying investments are mostly blue-chip ASX shares, ranging (as of 31 December) from BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA) to Santos Ltd (ASX: STO) and Aristocrat Leisure Ltd (ASX: ALL).

Since Argo manages this portfolio, investors can sit back and forget about buying and selling the right ASX shares. In this way, Argo is a fantastic choice for investors who want to invest in Australian shares but are happy to outsource the hard work.

In that vein, MFF Capital Investments Ltd (ASX: MFF) is a complementary investment to Argo. MFF is another LIC. Instead of holding a portfolio of Australian shares, it opts for the best stocks on the American markets to build wealth for shareholders. MFF has always followed a long-term buy-and-hold mindset. Many of its largest holdings, including Meta Platforms, Google owner Alphabet, Mastercard, and American Express, have been in its portfolio for years.

Adding companies of this world-leading calibre to a portfolio is, in my view, a great way to complement Argo's Australian blue chips.

Our final investment is another inherently diversified, passive-friendly choice. It is the Vanguard Diversified High Growth Index ETF (ASX: VDHG). This exchange-traded fund (ETF) is really a collection of different index funds. It offers investors exposure to the entire ASX, as well as international markets, emerging markets, and international small companies. It also has a small allocation to fixed-interest investments.

This 'ETF of ETFs' is a highly diversified passive investment that offers exposure to almost all corners of global markets.

Foolish takeaway

This simple three-stock portfolio may suit an investor looking to passively build wealth using stocks. You are getting some of the ASX's most reliable blue-chip shares through Argo. MFF complements them with some of America's best companies, while Vanguard's VDHG ETF adds a layer of diversification to the mix. If I were starting an investing journey in 2026, dividing your capital equally between these three investments would, at least in my view, be a good place to start building wealth.

The post Any ASX investor can use this simple 3-stock portfolio to build wealth appeared first on The Motley Fool Australia.

At the time of writing, the listed investment company (LIC)'s shares are up 0.32% to $9.15.

By comparison, the S&P/ASX 200 Index (ASX: XJO) is slightly higher by 0.1%.

While today's announcement is mostly administrative, it provides useful visibility for income-focused investors.

Let's take a look at what's ahead for the start of the year.

Key dates now locked in

According to the release, Argo confirmed the key dates tied to its half-year results and interim dividend for early 2026.

The company will release its half-year results for the period ending December 31, 2025, on Monday, February 9, 2026. That announcement will also include confirmation of the interim dividend, subject to board approval.

For shareholders, the important dividend dates are:

• Ex-dividend date: Friday, 13 February 2026

• Record date: Monday, 16 February 2026

• Last day to elect the DRP or DSSP: Tuesday, 17 February 2026

• Dividend payment date: Friday, 20 March 2026

Why this matters for income investors

Argo is widely held by investors seeking steady, tax-effective income rather than rapid capital growth. As a long-established LIC, its appeal lies in diversification, low turnover, and consistent fully-franked dividends over time.

While today's announcement does not reveal how large the interim dividend will be, it does give shareholders a clear roadmap for early 2026. That can be very useful for retirees and self-managed super fund investors who rely on predictable income streams.

Argo's most recent final dividend for 2025 was 20 cents per share, fully franked. Over the longer term, the company has built a strong reputation for maintaining dividends through market cycles, supported by a conservative investment approach.

A steady performer in a volatile market

The relatively muted share price reaction reflects the administrative nature of the update. There was no change to earnings guidance or portfolio positioning, and nothing unexpected for investors already familiar with Argo's dividend pattern.

That said, the shares continue to trade at a modest premium to net tangible assets, which is common for well-regarded LICs with long dividend track records.

Foolish Takeaway

Today's update is unlikely to shift Argo's share price in the short term, but it reinforces the stock's position as a dependable income option.

With key dividend dates now confirmed for early 2026, investors have greater clarity around timing, which matters for anyone planning regular income.

That helps explain why Argo continues to attract income-focused investors, even though the share price has moved little over the past year.

The post Argo just locked in its key dates for 2026. Here's what investors need to know appeared first on The Motley Fool Australia.

What did Argo Investments report?

• Maximum of 37 million shares to be bought back on market
• Total shares on issue: 758,789,060
• Buy-back will run from 2 January 2026 to 31 December 2026
• Macquarie Securities (Australia) Ltd appointed as broker
• Buy-back to be conducted in Australian dollars (AUD)
• No security holder approval required

What else do investors need to know?

The buy-back is intended as part of Argo Investments' ongoing capital management strategy. By renewing its on-market buy-back facility for another 12 months, the company is providing itself an additional lever to support its share price and return surplus capital to shareholders when appropriate.

The buy-back does not specify a minimum number of shares to be purchased, giving the company flexibility to act in shareholders' best interests depending on market conditions. Shareholders are not required to approve this buy-back.

What's next for Argo Investments?

The buy-back program gives Argo Investments the ability to manage its capital more efficiently, potentially enhancing returns for existing shareholders. The company will review market opportunities throughout the year and adjust the pace and scale of buy-backs as needed.

Looking ahead, continued focus on disciplined capital management is likely to remain a core part of Argo's strategy, with an eye on delivering steady returns for investors.

Argo Investments share price snapshot

Over the past 12 months, Argo Investments shares have risen 2%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 6% over the same period.

View Original Announcement

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If an investor wishes to take a path of lesser resistance, they only need to buy one Aussie stock for lifelong income.

However, if an investor is only going to buy one stock, it should arguably be one that is inherently diversified. Buying a company like Telstra Group Ltd (ASX: TLS) or Commonwealth Bank of Australia (ASX: CBA) won't cut it, as it opens one up to severe industry risk.

Luckily, there are quite a few Aussie dividend stocks that do fit the bill if an investor wishes to buy one income-producing stock to set them up for life.

Buying an Aussie dividend stock for lifelong income

It's my view that buying any one of the following Aussie stocks (or exchange-traded funds (ETFs)) will deliver that kind of sustainable income.

These Aussie income stocks can set anyone up for life.

To start with, an income-seeking investor could opt for either Argo Investments Ltd (ASX: ARG) or the Australian Foundation Investment Co Ltd (ASX: AFI). Both of these stocks are listed investment companies (LICs) that have been around for decades and own vast portfolios of underlying shares within them. These diversified portfolios, which are built on blue-chip stocks like Telstra and CBA, are managed on behalf of shareholders.

Both AFIC and Argo have long track records of providing substantial and fully franked dividend payments. As such, they make fine candidates for single, simple investments that can set income investors up for life.

Investors could also consider ETFs, though.

ASX ETFs for dividends?

Even a basic index fund like the Vanguard Australian Shares Index ETF (ASX: VAS) would make a compelling option. The ASX is home to dozens and dozens of strong dividend payers. This ETF houses them all and provides investors with what could be described as the average level of dividend income that the Australian stock market pays.

It has paid out four dividend distributions over the past 12 months, which gives this index fund a trailing yield of 3.09% today. As this yield does represent an average of the entire market, it does tend to fluctuate over time. But long term, the trajectory should be up-and-to-the-right.

If that yield doesn't look big enough, investors also have the option to go for an ASX ETF that prioritises maximising income. Two ETFs that could fit this bill include the Vanguard Australian Shares High Yield ETF (ASX: VHY) and the BetaShares S&P Australian Shares High Yield ETF (ASX: HYLD).

These funds hold a basket of underlying shares, all selected on their ability to fund large, sustainable income into the future. Again, the dividend distributions from these funds will differ from year to year. Both are offering trailing yields well north of 4% right now.

Foolish Takeaway

Those investors seeking dividend income need not build out a full portfolio of dozens of dividend shares. Any one of the options named above would, at least in my view, be a perfectly adequate lifelong income investment on its own merits.

If you choose one, invest as much as you can, and as often as you can, and reinvest all dividends to start with. Your passive income will snowball and become an avalanche before you know it.

The post The only Aussie stock you'll need for lifelong income appeared first on The Motley Fool Australia.

Argo Investments Limited (ASX: ARG)

The venerable Argo Investments is one of Australia's oldest and largest listed investment companies. Established in 1946, it has delivered consistent returns to shareholders. The firm now invests about $8 billion on behalf of more than 89,000 shareholders and has delivered an annualised total shareholder return of 6.2% over the past decade.

Australian Foundation Investment Company (ASX: AFI) 

AFIC's 10-year returns are almost a carbon copy of Argo's, coming in at 6.5%, and the similarities don't end there. AFIC is even older than Argo, established in 1928, and similarly looks to invest over the long term, focusing on safety and dividend payments. Investing in AFIC gives exposure to Australia's top blue-chip shares, with its largest holdings in stocks such as BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), and CSL Ltd (ASX: CSL).

Washington H Soul Pattinson & Company (ASX: SOL)

Soul Patts, as this investment outfit is generally known, has hit it out of the park over the past 12 months, delivering shareholders a return of 31.7%, and 14.4% over the past decade. The fund boasts that it has not missed a dividend payment since it was listed in 1903 and has increased dividend payments in each of the past 24 years.

WAM Leaders (ASX: WLE)

This fund looks to invest in large-cap companies "with compelling fundamentals, a robust macroeconomic thematic and a catalyst''. It claims to have returned 12.5% per annum since May 2016 and now manages just under $2 billion, so it must be doing something right. Currently, the fund's fully-franked dividend yield is sitting at 7%.

Ophir High Conviction Fund (ASX: OPH)

This fund looks to find high-quality companies which are generating good cash returns before the rest of the market catches on, or in their own words, when they are "typically under-researched and undervalued by the investment market''. The fund has notched up more than 300% in total net returns since inception in August 2015 and an impressive 26.7% over the past 12 months.

The post These are the five stocks I'd build a long-term portfolio around appeared first on The Motley Fool Australia.

Although it is difficult to achieve this and requires a large investment of both money and time, it can most certainly be done. Today, let's discuss the easiest way I think any Australian can get to $50,000 in passive income from ASX dividend shares.

The first thing you need to do is make sure your budget has enough spare room in it to afford a regular investment plan. To do this, one needs to ensure that they are spending less than they're earning, and are, apart from mortgages and HECS, debt-free.

Once that's been achieved, the next step is finding the ASX dividend shares to invest in.

Buying ASX dividend shares

There are countless options to choose from in this regard. Many investors opt for a collection of the ASX's most famous and prominent dividend payers. These include Telstra Group Ltd (ASX: TLS), Woolworths Group Ltd (ASX: WOW), or Commonwealth Bank of Australia (ASX: CBA).

Whilst this is certainly a valid path to tread, I think newer investors might be better off sticking with a diversified company or exchange-traded fund (ETF). These investments typically pool other ASX dividend shares within an underlying portfolio and look after them on your behalf.

Some examples of these investments include listed investment companies (LICs) like Argo Investments Ltd (ASX: ARG) or the Australian Foundation Investment Co Ltd (ASX: AFI).

Other investors might prefer a dividend-focused ETF, such as the Vanguard Australian Shares High Yield ETF (ASX: VHY).

All you need is one of these funds, and you're off to the races.

It's not a sprint race though, but a marathon. Building up an income stream as quickly as possible requires regular investing and the reinvestment of dividends.

There are no shortcuts here. It's simply a matter of the more you invest, and the more frequently you do so, the faster you'll get to your goal.

Many investors worry about timing the market, about 'buying low' and 'selling high'. This is almost always a mistake. I think a better creed for investors to hold to is that 'the best time to invest was 10 years ago, the second best, right now'.

Contrary to what you might see in the media, markets go up far more often than they go down. As such, we should all endeavour to invest as much as we can, as soon as we can.

Buy more shares, get a higher second income

Now, if you buy any of the investments listed above, you'll start receiving dividend income right away. It might be tempting to spend this or keep it in your savings account. But if you wish to build wealth (and passive income) as fast as possible, consider just ticking the 'reinvest my dividends' box when you initially buy the shares. This ensures that your dividends will buy more shares, which will then pay you even more dividends and so on, accelerating the compounding process.

Now, let's talk numbers. To get to $50,000 per year in passive income, let's assume that your investment offers a 4% dividend yield. By that logic, you'll need a portfolio worth just over $1.2 million before you can stop those dividends reinvesting and enjoy that passive income.

If your investment earns 8% per annum, it will take about 28 years investing $1,000 every month to get there. Again, you can speed this up by either increasing your regular investments, or by finding higher-returning assets. To illustrate, increasing your investment to $2,000 a month brings your wait time down to about 20 years.

But if one starts young enough, this strategy can certainly help fund an early retirement.

The post Here's how to target a $50,000 annual second income, starting from zero appeared first on The Motley Fool Australia.

At the start of 2025, one might have considered just leaving that $10,000 in a savings account or term deposit and receiving passive income in the form of interest. But after what has now been three interest rate cuts this year so far, that option is fast becoming less attractive.

So what's the alternative? Investing in ASX dividend shares, of course. Dividend shares are one of the assets to use if you want to build up a stable source of passive income.

There are obviously dozens, if not hundreds, of individual ASX dividend shares to choose from, which can make starting an investing journey quite daunting.

However, if you have $10,000 or a similar amount and wish to start, it might be a good idea to start with one diversified investment.

There are many options to choose from. The best choices for a beginner investor, in my view anyway, are index funds and listed investment companies (LICs).

Choosing a passive income investment for $10,000

These investments group a selection of underlying shares within a single investment. For example, an ASX index fund like the iShares Core S&P/ASX 200 ETF (ASX: IOZ) holds the 200 largest stocks on our share market.

An index fund like this would be a good choice. Most of the largest 200 companies on the ASX pay out dividends. By grouping them all together, investors can achieve an average of these dividends. The IOZ index fund currently has a trailing dividend yield of roughly 3.4% at current pricing. That's enough to start a substantial stream of passive income right off the bat.

If you are after a bit more income up front, you can opt instead for a dividend-focused exchange-traded fund (ETF) like the Vanguard Australian Shares High Yield ETF (ASX: VHY). This ETF works similarly to IOZ, but rather than holding the largest 200 companies on the ASX, it holds a smaller portfolio of stocks selected for their dividend history and potential.

LICs are an alternative to index funds. Rather than blindly tracking an index, LICs function as companies that manage an underlying portfolio of diverse stocks on behalf of shareholders.

Two prominent examples are Australian Foundation Investment Co Ltd (ASX: AFI) and Argo Investments Ltd (ASX: ARG). Both of these LICS have been around for decades. Since their inception, both have developed well-earned reputations as conservative wealth managers, investing in sound companies for the benefit of their long-term investors. Both pay out generous passive income too, in the form of fully franked dividends. AFIC is currently trading on a dividend yield of 3.57%, while Argo is closer to 4%.

Foolish Takeaway

Whether you opt for an index fund or an LIC for your first $10,000 investment, you are taking a decisive first step in starting a source of passive income. If you just set these funds and forget about them, while reinvesting any and all dividends you receive, you will have a strong and growing source of passive income before you know it.

The post $10,000 in savings? Here's a smart passive income plan for investors to consider appeared first on The Motley Fool Australia.

If you're close to buying your first ASX shares, chances are you'll already know about the potential benefits of investing your money in the share market. Into quality businesses that can help grow and compound your wealth over time.

However, having this theoretical knowledge is very different from taking the plunge and buying your first shares.

With so many options to choose from, and perhaps many opinions and recommendations from others to sift through, putting the proverbial pen to paper can be harder than one might think.

Today, let's try and make this process easier for beginner investors by discussing the ASX shares that I think would make a great start for any new investor's portfolio.

Three ASX shares perfect for a beginner investor to buy

Coles Group Ltd (ASX: COL)

First up, we have Coles, a company that most of us would no doubt be fairly familiar with. I've chosen Coles not for its flying growth potential, but for its simplicity, and reliability.

If an investor wants to really get into investing, it's important that they get familiar with a company, how it works, and how it makes money. This is easier said than done for many businesses in our modern world.

However, Coles remains a fairly easy business to get one's head around, in my view. An investor can go into a store any time they like, and take a look at 'their' company's physical assets.

This is an important part of investing, and I think Coles is a great first stock to buy in this light.

Coles is a steady, reliable company with healthy cash flows too. I think there's very little risk of Coles going bankrupt. Additionally, investors will get Coles' decent, fully franked dividend. This is currently yielding around 3.5%.

Argo Investments Ltd (ASX: ARG)

Next up, we have listed investment company (LIC) Argo Investments. LICs like Argo are a different kettle of fish to traditional businesses like Coles. Yes, they are companies. But instead of producing a good or service, they invest in other assets on behalf of their shareholders.

In Argo's case, this LIC has been around for almost a century. Over its long life, it has made a name for itself as a conservatively-managed, diversified investment. One that provides decent growth and chunky, fully franked dividend income for long-term investors.

To achieve this, Argo holds a massive portfolio (around 90) of blue chip ASX shares, which it manages for its shareholders. As of 28 February, some of its largest holdings included Commonwealth Bank of Australia (ASX: CBA), Telstra Group Ltd (ASX: TLS), Suncorp Group Ltd (ASX: SUN), and Woolworths Group Ltd (ASX: WOW).

If you'd like to start investing, but don't know which individual company to go for as your first share, Argo is a great option, given its underlying exposure to so many diversified businesses.

I think any investor could comfortably hold this LIC as their only investment if they so wished.

iShares S&P 500 ETF (ASX: IVV)

Finally, another stock beginner investors can consider for their first investment is this exchange-traded fund (ETF). The iShares S&P 500 ETF is an index fund that tracks the flagship S&P 500 Index (SP: .INX). This index represents the largest 500 companies that are listed on the stock markets of the United States. So no ASX stocks here.

It's no secret that the USA is home to many of the world's great businesses. If you buy this ETF, your largest underlying positions will be the likes of Apple, Microsoft, Amazon, and Google-owner Alphabet. But you'll also be invested in famous names like Coca-Cola, Netflix, Walmart, Mastercard, Colgate-Palmolive, and JP Morgan Chase.

The ASX is home to many great companies, but few offer the kind of world dominance that the S&P 500's top names do.

With this index fund being endorsed by none other than legendary investor Warren Buffett, I think it would make a fine first stock for any new ASX investor today.

The post 3 ASX stocks perfect for first time investors appeared first on The Motley Fool Australia.

Shares in the Aussie listed investment company (LIC) closed on Friday trading for $9.02. In late Monday morning trade, shares are changing hands for $9.03 apiece.

While that sees Argo shares up a slender 0.1% at time of writing, it certainly beats the 1.9% losses posted by the ASX 200 at this same time. Aussie investors are clearly anxious today following major tariff announcements over the weekend from US President Donald Trump.

Here's what's supporting the Argo share price during the broader market sell-down.

ASX 200 stock reports record interim dividends

The Argo share price is catching tailwinds after the company released its half-year results (H1 FY 2025) covering the six months to 31 December.

Among the highlights, the ASX 200 stock declared an all-time high fully franked interim dividend of 17.0 cents per share. That's up 3% from the H1 FY 2024 interim dividend. And it sees the LIC trading at a fully franked dividend yield (part trailing, part pending) of 3.9%.

In other core financial metrics, revenue of $137.5 million was up 3.7%, boosted by better-than-expected dividends from a number of companies in Argo's investment portfolio.

However, profits declined by 3.3% year on year to $121.2 million. The company's management expense ratio remained stable at 0.15%.

On the performance front (as measured by the net tangible assets (NTA) return after all costs and adjusted for company tax paid), the ASX 200 stock gained 11.7% in the calendar year 2024, outpacing the 11.4% increase posted by the S&P/ASX 200 Accumulation Index.

But the second half of calendar year 2024 (H1 FY 2025) saw Argo return 6.3%, trailing the 6.9% increase on the Accumulation Index.

Management credited Argo's holding of software-as-a-service provider Technology One Ltd (ASX: TNE) as the most significant positive contributor to the LIC's performance over the half-year. The Technology One share price soared some 65% over the six months.

Dragging on the half-year performance was Argo's underweight exposure to ASX 200 bank stock Commonwealth Bank of Australia (ASX: CBA). The CBA share price surged more than 20% during the half-year. But Argo said CBA represented only 4.9% of its investment portfolio compared to 9.4% of the Accumulation Index.

Now what?

Looking at what could impact the ASX 200 stock ahead in 2025, management noted that "Donald Trump's election has triggered significant share market volatility".

According to Argo's management:

Looking ahead, we expect the new US administration's policies and pronouncements will continue to drive major market movements and play a pivotal role in reshaping the global economic landscape, including trade conditions and supply chains.

Despite recent market fluctuations, we remain generally optimistic about the outlook for the domestic economy. The jobs market remains strong, corporate balance sheets are robust, and expenditure has remained resilient.

And the ASX 200 stock could benefit from forecasts of ongoing strength in the US dollar.

Argo noted:

With cash available to capitalise on short-term opportunities and a diversified portfolio, Argo is well-positioned to navigate the current investment landscape. Notably, our portfolio includes stocks that generate US dollar revenue positioning them to benefit from the strong greenback.

The post How this $6 billion ASX 200 stock is beating the benchmark on Monday appeared first on The Motley Fool Australia.

Meanwhile, you may have watched incredulously as the Aussie stock market soared 18% over the past year and cracked multiple all-time highs in the process.

Now what? Are you thinking perhaps you should hold off and wait to buy the dip? Is now really a good time to invest?

As Motley Fool's chief investment officer, Scott Phillips, wrote this week, no one knows what the market will do next, especially in the short term. And Scott's advice? "Just keep investing!"

Scott explained that over his almost 30 years of investing, he didn't "try to time the market". He just "saved regularly, invested steadily, and stayed the course". He further highlighted that the stock market "has never yet failed to regain, then surpass, a record high".

So, we asked our Foolish writers which ASX shares they think are great buys right now for beginner investors.

Here is what they came up with:

6 best ASX shares for newbie investors in October 2024 (smallest to largest)

• Nick Scali Limited (ASX: NCK), $1.35 billion
• Betashares Nasdaq 100 ETF (ASX: NDQ), $4.94 billion
• VanEck MSCI International Quality ETF (ASX: QUAL), $6.20 billion
• Argo Investments Limited (ASX: ARG), $6.76 billion
• Woolworths Group Ltd (ASX: WOW), $40.29 billion
• Resmed Inc (ASX: RMD), $50.93 billion

(Market capitalisations as of market close 4 October 2024).

Why our Foolish writers love these ASX stocks

Nick Scali Limited

What it does: When looking to style a living or dining room, Nick Scali is a brand that often comes to mind. Boasting 128 store locations across Australia and New Zealand, the high-end furniture retailer is well-established locally. But Nick Scali is no couch potato, expanding into the United Kingdom more recently.

By Mitchell Lawler: When I think about what makes a good ASX share for beginners, there are two key traits I'm looking for: 

• An easy-to-understand business (preferably one you're a customer of)
• Simple and solid fundamentals for valuing the business.

I frequently hear of people who 'tried' investing and now swear off it altogether. Almost every time, it involved an extremely speculative company, often in a pre-profit stage, leaving would-be investors to assign a valuation based mostly on hopes and dreams. 

Nick Scali is not that. This company has survived and thrived for 62 years, is highly profitable (~17% net margin), and can be easily assessed on real returns to shareholders today (not some arbitrary point in the future). 

Plus, at a price-to-earnings (P/E) ratio of 17 times and a projected annualised earnings growth rate of 10%, I believe Nick Scali trades on an undemanding valuation. 

Motley Fool contributor Mitchell Lawler does not own shares of Nick Scali Limited.

Betashares Nasdaq 100 ETF

What it does: This ASX exchange-traded fund (ETF) seeks to mirror the performance of the NASDAQ-100 Index (NASDAQ: NDX), before fees. 

By Bronwyn Allen: We live in an increasingly technological age, so I think the NDQ ETF provides a great no-brainer investment for beginners.

The ETF tracks the NASDAQ-100 index, which represents the largest 100 companies on the NASDAQ exchange. The NASDAQ-100 is full of tech stocks, including big names like Alphabet, Nvidia, and Microsoft, as well as many leading global companies in other sectors.

Betashares investment strategist Tom Wickenden reckons the NASDAQ-100 is home to global innovators, who are more likely to deliver superior earnings growth in the future.

The companies comprising the NASDAQ-100 have a global revenue base, and the index has opposite sector weightings to the ASX 200. This makes NDQ a great complementary holding next to an ASX index-based ETF. The ASX NDQ also has a great track record, delivering an average total return of 20.23% per year since 2019. 

Motley Fool contributor Bronwyn Allen does not own units of the Betashares Nasdaq 100 ETF. 

VanEck MSCI International Quality ETF

What it does: This is a globally-focused ASX ETF that invests in a portfolio of businesses that rank highly on various quality factors.

By Tristan Harrison: I think beginner investors would be well-served by considering an ETF that provides instant diversification, owns high-quality shares and can deliver strong, long-term returns.

The QUAL ETF is invested in around 300 businesses from around the world. There are a number of countries represented in the portfolio, including the United States, Switzerland, the United Kingdom, Denmark, Japan, the Netherlands, France, Canada, Sweden, Italy, Ireland, and Germany.

To make it into the portfolio, companies must rank well on three factors: high return on equity (ROE), earnings stability, and low financial leverage. When you combine these elements, you'll find a very compelling business. Every single one of the holdings in this ETF is a high-quality company.

Past performance is not a reliable indicator of future returns, but the QUAL ETF returned an average of 16.5% in the five years to 31 August 2024. Some of its biggest positions currently include Nvidia, Meta Platforms, Apple, Microsoft, and Alphabet.

This is the sort of investment that could make solid returns for decades, in my opinion. 

Motley Fool contributor Tristan Harrison does not own units of the VanEck MSCI International Quality ETF or any of the stocks mentioned.

Argo Investments Limited

What it does: Argo Investments is a listed investment company (LIC) that has been around for decades on the ASX. It invests in a portfolio of underlying shares on behalf of its shareholders, which it manages with trademark conservatism.

By Sebastian Bowen: When considering the right shares for a beginner on the ASX, I'm a big advocate for starting with broad-based investments that offer inherent diversification and minimal permanent capital loss potential.

In this vein, I think Argo is a great fit. This LIC has been around since the end of World War II. Over the subsequent decades, it has built up a reputation as being a solid, conservatively managed company that has delivered respectable growth and dividend income for its investors.

Argo holds a huge portfolio of investments dominated by blue-chip Aussie shares. These typically include everything from Commonwealth Bank of Australia and Telstra to Woolworths and Bunnings-owner Wesfarmers.

For one, this gives Argo shareholders a huge amount of safety, as their money isn't tied up to the fortunes of one single company. But it also means investors tend to enjoy an 'average' return, of sorts, of the whole stock market. 

I think this is a perfect combination for a beginner investor who wants to start their investing journey with a toe dip.

Motley Fool contributor Sebastian Bowen owns shares of Telstra Group Ltd and Wesfarmers Ltd.

Woolworths Group Ltd

What it does: Founded in 1924 and listed on the ASX in 1993, Woolworths owns Australia's biggest supermarket chain. The company has more than 1,000 stores across the nation and more than 185 stores in New Zealand. Woolworths also owns Big W.

By Bernd Struben: When it comes to shares for beginners, I think Woolworths' lengthy track record makes it a good starter stock. And with inflation heading lower, customers may again boost spending even as Woolies' operating costs come down.

Now, Woolworths' stock has dropped 10% since 28 August as the government mulls over the alleged duopoly it shares with rival Coles. And the recent ACCC accusation of misleading sales price advertising hasn't helped improve investor sentiment.

But I believe both issues are temporary, and Woolworths should be able to weather the spate of unfavourable media coverage. This makes the recent share price retrace a potentially opportune entry point.

Atop the potential for a share price rebound, Woolworths is also a reliable dividend payer. At Friday's closing price of $32.98, Woolies shares trade on a fully franked trailing dividend yield of 4.37%.

Motley Fool contributor Bernd Struben does not own shares in Woolworths Group Ltd.

Resmed Inc

What it does: ResMed is a medical device company that focuses on developing, manufacturing, and distributing sleep disorder treatment solutions. 

By James Mickleboro: If you are just starting your investment journey, then I believe it is important to focus on high-quality companies with the potential to grow materially over the long term.

ResMed ticks both of these boxes for me. Not only is it a global leader in sleep health, but it has one of the most positive growth outlooks on the Australian share market. For example, last week, the company released its five-year revenue and earnings guidance. 

ResMed revealed it expects to help more than 500 million people worldwide achieve their full health potential in 2030. The company believes this will position it to grow revenue in the high single digits each year and earnings at an even quicker rate.

And while ResMed shares have already risen strongly over the past 12 months, analysts at Ord Minnett don't believe it is too late to invest. They recently put an accumulate rating and $39.00 price target on the stock.

Motley Fool contributor James Mickleboro owns shares of ResMed Inc.

The post Top ASX shares for beginner investors to buy in October 2024 appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) closed the week up 0.82% to 8,209.5 points. The benchmark index leapt to a new record high of 8,246.2 points during intraday trading on Friday.

The ASX 200 was propelled northward last week by a larger-than-expected cut in United States interest rates, and Australian unemployment remaining steady at 4.2% for the month of August.

Nine of the 11 market sectors finished the week in the green.

Let's recap what happened.

Financial shares led the ASX sectors last week

Four of the five major ASX 200 bank shares hit new price milestones on Friday.

Macquarie Group Ltd (ASX: MQG) shares charged to a new all-time high of $233.91 on Friday. The Macquarie share price lifted 1.11% to finish the week at $231.17.

Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares hit a seven-year high of $31.94 on Friday. ANZ shares closed the week at $31.89, up 2.11%.

Westpac Banking Corp (ASX: WBC) shares rose 3.42% over the five days to finish at $33.57. Westpac shares smashed a six-year high of $33.65 during intraday trading on Friday.

National Australia Bank Ltd (ASX: NAB) shares also screamed up the charts last week, reaching a 17-year high of $39.77 on Friday. NAB shares closed the week at $39.67, up 3.2%.

Commonwealth Bank of Australia (ASX: CBA) shares rose by 1.36% to finish at $144.50 on Friday.

CBA was the only major bank share not to set a new multi-year high last week. That said, CBA shares did strike a new all-time record level on 10 September at $145.24 per share.

Insurance shares put in a mixed performance last week. The Suncorp Group Ltd (ASX: SUN) share price rose by 0.17% to close to $18.21 on Friday. Medibank Private Ltd (ASX: MPL) shares lost 3.18% to $3.65.

Among the investment houses and wealth managers, Washington H. Soul Pattinson and Co Ltd (ASX: SOL) shares rose 0.71% to $33.90 per share on Friday. GQG Partners Inc (ASX: GQG) shares rose 5.26% to $2.60 and the Magellan Financial Group Ltd (ASX: MFG) share price lifted 1.48% to $9.61.

Listed investment company (LIC) Argo Investments Limited (ASX: ARG) shares rose 0.79% to $8.93. Shares in financial services company AMP Ltd (ASX: AMP) fell by 0.76% to close at $1.31 on Friday.

Buy now, pay later stock Zip Co Ltd (ASX: ZIP) put in another strong week, rising 14.35% to close at $2.67 on Friday. The Zip share price hit a two-year high of $2.75 per share on Friday.

In the year to date, Zip shares have skyrocketed by 330.65%.

ASX 200 market sector snapshot

Here's how the 11 market sectors stacked up last week, according to CommSec data.

Over the five trading days:

The post Here's how the ASX 200 market sectors stacked up last week appeared first on The Motley Fool Australia.

But sadly, most Australians today don't have enough in superannuation to make this happen on its own. As such, the best way we can hope to get to a seven-figure nest egg by the time we reach retirement age is by investing in ASX shares outside superannuation.

So today, let's talk about three ASX hacks you can use to hopefully get to a retirement nest egg of $1 million one day by investing in the share market.

3 ASX hacks to help get to a $1 million nest egg

Put your investing on autopilot

I think the best way to invest in ASX shares, particularly for someone who doesn't get a thrill out of the whole process, is to automate your investing. Make a commitment to yourself to invest $100, $200 or $500 a month (or whatever you can afford) into your nest egg, and stick to it as best you can. Rain, hail or shine.

Most investors get hamstrung from time to time by thinking that, for whatever reason, the present isn't a good time to invest. You might be expecting a stock market crash, or have read some professional investors' predictions of an economic slowdown.

You want to avoid all of that. So make a plan and stick to it as closely as you can. Hopefully, you can even forget you're doing it. By the time five, ten or 20 years go by, you'll almost certainly notice some real changes to your wealth if you do so.

Reinvest your earnings and dividends

Investing in ASX shares pays dividends. Literally. Chances are that if you own ASX shares, you'll regularly receive dividend payments. This passive income is one of the best and most obvious benefits of owning shares.

But many people treat this income as disposable and simply add it to their everyday bank accounts, where it is quickly frittered away.

This would be a big mistake. Dividends form a huge component of the overall returns we enjoy from our share market. So siphoning these away from your portfolio is kneecapping the wealth-building effects you might otherwise enjoy from investing.

As such, if you're looking to build wealth as efficiently and effectively as possible, make sure you are always reinvesting your dividends back into ASX shares. That way, you'll receive even higher levels of income next dividend payday, kickstarting a virtuous cycle.

You can turbocharge this ASX hack further by investing any windfall earnings you might receive. These could be a tax return or an insurance payout. Any spare cash you can direct into your ASX portfolio brings that $1 million nest egg closer.

ASX hack: Keep your investing simple

Finally, and perhaps most importantly, I think almost every ASX investor who is aiming to build a $1 million nest egg through the stock market needs to keep their investing simple.

The worst thing an investor can do is get ahead of themselves and invest in the wrong stocks. Nothing is more demoralising than losing all your money on a couple of bad stock picks and having to start all over again from square one.

If you have a passion for investing and picking undervalued stocks, then, by all means, go for it. But if you're a 'check your portfolio once a month' kind of investor, it might be better to stick with simple, hands-off investments like index funds.

An index fund like the iShares Core S&P/ASX 200 ETF (ASX: IOZ) or even a listed investment company (LIC) like Argo Investments Ltd (ASX: ARG) are great choices for hands-off investors. They basically do the hard yards of investing for you and are perfect for putting your regular investments on autopilot.

The post 3 ASX hacks to build a $1 million retirement nest egg appeared first on The Motley Fool Australia.

That's fair enough of course. There are hundreds of different ASX shares to choose from on the ASX. With the varying opinions and recommendations one is often inundated with when first starting out in the share market, this can make it easy to follow the wrong advice and go for a company that may not be a wise choice for a long-term investment.

As such, today, I'll be discussing three ASX shares that I think would make great, lower-risk picks for a beginner investor. No ASX share is a risk-free investment, of course. But I think these three picks are about as safe as an ASX share can be.

3 lower-risk ASX shares for a beginner investor

Coles Group Ltd (ASX: COL)

It's my view that the lowest-risk shares on the ASX are companies that provide goods or services that we need rather than want. Of life's basic needs, none come above food. That's why I think Coles is a great choice for investors looking for a safer entry point into the Australian stock market.

Coles has a nationwide network of supermarket grocers that many Australians go to to buy food, drinks, and household essentials. We can be reasonably sure that this isn't going to change anytime soon, as Coles is always under pressure to sell us these basics at the cheapest pricing it can.

This isn't an investment that will make anyone rich overnight, but I think Coles has the potential for some modest capital gains going forward. The company also offers a hefty (and fully-franked) dividend, which is currently yielding just under 4%.

Telstra Group Ltd (ASX: TLS)

In a similar vein, I also view Telstra as a good choice for beginner investors who are looking for a low-risk share to dip their toes into the stock market world. While food, drinks, and household essentials are at the top of our basic needs, reliable internet access is also a top priority in today's modern world.

Telstra is the gold standard stock to invest in if you want a slice of that action. It is the largest provider of both mobile and fixed-line internet services in Australia, and its mobile network is almost universally regarded as superior to those of its competitors.

Like Coles, Telstra's earnings are unlikely to be severely affected by any problems in our economy. Whether we are dealing with high inflation or an economic recession, Telstra's customers are probably not going to stop paying for phone usage or internet access. This inherent defensiveness makes this company another great choice for any beginner investor today.

Telstra shares also offer investors a decent, fully franked dividend yield. At inflation prices, this was just under 5%.

Argo Investments Ltd (ASX: ARG)

A final ASX share that I think any beginner can consider as a low-risk starter investment is Argo Investments. Argo is a listed investment company (LIC), which means it actually functions as something akin to a managed fund.

Rather than producing or selling goods or services itself, it runs a portfolio of other investments on behalf of its investors. Argo has been around for a very long time. It first opened its doors back in 1946. Since then, it has built up a reputation as a conservative and reliable steward of its investors' capital.

Argo's strength comes from its diversified portfolio of ASX shares. It consists of dozens of underlying ASX shares, which (as of 31 May) included everything from Commonwealth Bank of Australia (ASX: CBA) and Telstra Group Ltd (ASX: TLS) to Suncorp Group Ltd (ASX: SUN) and TechnologyOne Ltd (ASX: TNE).

Thanks to this huge, diversified portfolio of different ASX companies, I think Argo represents a very low-risk ASX share that any beginner investor can feel comfortable holding. Argo also pays out a regular, fully franked dividend, which was recently trading at a yield of around 4%.

The post 3 lower-risk ASX shares for beginner investors appeared first on The Motley Fool Australia.

But if you've got a spare $500 this March, putting it into the share market is a great move in my view. As with many things, the first step with investing is often the hardest. I can guarantee that the second $500 you invest in ASX shares is a lot easier to part with than the first. The third, easier still.

But the big decision remains: which ASX share does one spend their first $500 on? And it is probably going to be just one share, as $500 is the minimum parcel value one can directly buy on the ASX.

Here's what I'd do – speaking as someone who once struggled with this choice.

How to spend your first $500 on ASX shares this March

I would invest in a broad-market index fund or a diversified listed investment company (LIC).

One of the biggest risk factors for your first investment is picking a speculative stock in the hope that it will rocket in value. Speculative investing is a practice that is best left to professional investors. For someone starting out, boring is better.

I would also shy away from buying an individual company at all with your first $500. Even seemingly blue-chip shares can present more risk for a first-time investor than an investment that covers the whole market.

So instead, I would recommend an investment along the lines of the Vanguard Australian Shares Index ETF (ASX: VAS), the iShares Core S&P/ASX 200 ETF (ASX: IOZ), the Australian Foundation Investment Co Ltd (ASX: AFI) or Argo Investments Ltd (ASX: ARG).

The first two investments are both exchange-traded funds (ETFs) and index funds. This means that they hold every ASX share within an index. In VAS' case, this is the S&P/ASX 300 Index (ASX: XKO), and in IOZ's, the S&P/ASX 200 Index (ASX: XJO). These indexes track the largest 300 and 200 shares on the market respectively.

That means each fund holds everything from Commonwealth Bank of Australia (ASX: CBA), Woolworths Group Ltd (ASX: WOW) and Telstra Group Ltd (ASX: TLS) to JB Hi-Fi Ltd (ASX: JBH), Harvey Norman Holdings Limited (ASX: HVN) and Xero Ltd (ASX: XRO).

What are the benefits of these investments for a first-time investor?

In this way, your $500 investment is spread out over hundreds of companies, rather than just being in one specific business. This enhances your diversification while removing the risk of your investment going to zero almost completely.

The listed investment companies AFIC and Argo function very similarly. They don't blindly track what these indexes are doing and have active managers looking after your money instead. But they still spread out your investment over a huge portfolio of diverse ASX shares.

I think a $500 investment in any one of these four options is a prudent way to dip your toes into the world of investing this March. They are simple investments that all have long track records of delivering meaningful returns to their stakeholders. In hindsight, I certainly wish my first purchase of ASX shares had been one of these.

The post With a spare $500, here's how I'd start buying ASX shares this March appeared first on The Motley Fool Australia.

Argo shares closed at $9.10 each last week. Today the LIC opened at $9.10 a share but has dropped 0.55% to $9.05 at the time of writing after falling as low as $9.03 this afternoon.

Still, investors might not be too disappointed given that the broader S&P/ASX 200 Index (ASX: XJO) is currently nursing a far more substantial 1.04% loss at present.

Half-year report highlights EPS, profits drop

• Argo reported a half-year profit of $125.3 million for the first half of the 2024 financial year (1H24), down 8.5% on the first half of the 2023 financial year (1H23)
• Earnings per share (EPS) of 16.5 cents, down 9.3% from 1H23's 18.2 cents
• Unchanged interim dividend of 16.5 cents per share, fully franked,
• Net tangible assets of $9.33 per share as of 31 December, up from $8.75 at the end of 1H23
• Management expense ratio (fee) reduced from 0.16% to 0.15%

What else happened in 1H24?

Argo's investment portfolio increased by 5.6% over the six months to 31 December 2023. This figure includes taxes that Argo has paid, as well as the management expense ratio. That underperformed the benchmark S&P/ASX 200 Accumulation Index, which achieved a return of 7.6% over the same period.

Some major moves that the LIC made in its investment portfolio include opening a position in ResMed Inc (ASX: RMD) and buying up more shares in CSL Limited (ASX: CSL), Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS).

Positions in Liontown Resources Ltd (ASX: LTR), Insurance Australia Group Ltd (ASX: IAG) and Invocare Ltd were closed, reducing Argo's overall portfolio to 86 positions.

Investors seem to have been more optimistic over the latter half of 2023 than they were at the time of Argo's October annual general meeting (AGM).

Following the company's AGM in late October, the Argo share price fell more than 2% over just a few days. That was despite the company announcing that it expected an improvement in global economic conditions (which have subsequently proved prescient).

What did management say?

There was no specific commentary from Argo's management in today's report. However, here's some of what the company said on its half-year:

Holdings in [Clarity Pharmaceuticals Ltd (ASX:CU6)] (up more than +170%) and [Stanmore Resources Ltd (ASX: SMR)] (up nearly +60%) contributed positively to performance. However, gains were offset by negative returns from other holdings, including pathology and imaging provider [Healius Ltd (ASX: HLS)].

In general, Australian healthcare providers have lagged due to higher costs and lower utilisation levels. Not owning Fortescue Ltd (ASX: FMG)] materially weighed on relative performance, as did our underweight exposure to the major banks…

The share price performance was +5.4%, with Argo shares now trading at a slight discount to their NTA backing. Sharply higher returns from term deposits have decreased the comparative appeal of many equity investments, including listed investment companies (LICs). We expect this trend to reverse as the monetary policy cycle continues and interest rates fall.

What's next for Argo?

Despite the bullish performance of the ASX stock market over 2024 so far, Argo is approaching the coming year with caution. The company warned that "bullish sentiment has seen investors largely overlook consensus expectations of lower company earnings for the remainder of 2024 and cast aside concerns about slowing growth and/or a monetary policy misstep".

Argo is also warning investors not to discount geopolitical threats during 2024, including the upcoming US elections. However, the company also argues that "With a strong balance sheet, no debt and cash on hand, Argo is well positioned as we enter the new calendar year".

Argo share price snapshot

As you can see in the chart above, the Argo share price has struggled in recent months. The company remains down 4.74% over the past year but has gained 1.8% over the last six months.

At the current Argo share price, this ASX LIC has a market capitalisation of $6.84 billion, with a dividend yield of 3.82%.

The post Argo share price falls as profits drop 8% appeared first on The Motley Fool Australia.