Rising oil and gas prices rattled investors, raising concerns about the impact on the businesses they were invested in.

We are starting to see that impact, with Qantas Airways Ltd (ASX: QAN) doubling its jet fuel cost estimates for 2H FY26 today.

Fortescue Ltd (ASX: FMG) chair Dr Andrew Forrest has also revealed they paid up to double for emergency fuel supplies last month.

With all this in mind, it's interesting to look at how Aussie investors repositioned their ASX ETF portfolios as the conflict unfolded.

Aussies have $329 billion invested in ASX ETFs, and last month they ploughed an additional $5.6 billion into their favoured funds.

That makes March the third-highest month for net inflows ever. It seems the volatility caused by the war did not dampen their interest.

A new report from Betashares, which shows the top 10 ASX ETFs for inflows and outflows last month, reveals some interesting trends.

Let's take a look.

Top 10 ASX ETFs for inflows last month

Top 10 ETFs for outflows

How ASX ETFs investors repositioned last month

The VAS ETF is the most popular Australian shares ETF on the market, so it's no surprise to see it take out the top spot.

VGS is the most popular international shares ETF, so it's routine to see it close to the top as well.

The presence of IHVV in the top inflows list, and its unhedged counterpart IVV ETF in the top outflows, shows investors are mindful of currency changes over the past 12 months.

The Australian dollar has risen from just over 60 US cents 12 months ago to a three-year high of 70.8 US cents today.

As James Gruber, Equity Market Strategist at CommSec, points out:

When the Australian dollar strengthens, your international ETF returns shrink, and if the Australian dollar weakens, your returns improve.

Outflows from QAU ETF reflect profit-taking amid a 21% decline in the gold price over the first three weeks of March.

Sprott Managing Partner, Paul Wong, said investors need not be worried though.

Wong added:

Gold's March drop reflects a liquidity crunch, not a breakdown in its long-term role. 

As financial stress builds, gold is likely to reassert itself as a key monetary anchor.

Another interesting trend is the inflows into non-US international ETFs, reflecting the poorer performance of US markets this year.

In the year to date, the S&P 500 Index (SP: .INX) has lifted just 0.6% compared to a 3% bump for the ASX 200.

The post How ASX ETF investors repositioned as the Iran war shook markets appeared first on The Motley Fool Australia.

According to Betashares, one of the three overarching megatrends that's shaping the future is climate change. 

Thematic investing is when an investor tries to identify long-term transformational trends. Investors can benefit if those trends play out.

According to Betashares, as a megatrend, climate change encapsulates:

• The impacts and resource scarcity caused by climate change and environmental degradation
• Policy initiatives designed to support decarbonisation and the climate transition
• Consumer and investor preferences for sustainability.

One way to target this megatrend is through ASX ETFs. 

There are several that aim to capture this theme, some of which have dropped to start 2026. 

This could make it an ideal time to initiate an investment in this theme.

Here are some climate positive ASX ETFs to consider. 

Betashares Climate Change Innovation ETF (ASX: ERTH)

ERTH ETF aims to track the performance of an index that comprises a portfolio of up to 100 leading global companies. These companies derive at least 50% of their revenues from products and services that help to address climate change and other environmental problems through the reduction or avoidance of CO2 emissions. 

This included clean energy providers and other leading companies tackling:

• Green transport
• Waste management
• Sustainable product development
• Improved energy efficiency and storage.

It has performed extremely well over the last 12 months relative to some other climate positive funds.

It is up 10.48% in that span. 

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

This fund aims to track the performance of an index (before fees and expenses) that includes a portfolio of large global stocks identified as "climate leaders."

These companies have also passed screens to exclude companies with direct or significant exposure to fossil fuels or engaged in activities deemed inconsistent with responsible investment considerations.

At the time of writing it is made up of just over 200 international companies. Its largest exposure (73%) is to the United States. 

It has fallen 8% in 2026. 

SPDR S&P World Ex Australia Carbon Control Fund (ASX: WXOZ)

This ASX ETF combines roughly 1,000 companies outside Australia. 

It is designed to measure the performance of S&P Global ESG Score-screened companies within the S&P Developed ex Australia LargeMidCap Index and weighted to minimise carbon intensity in the portfolio. 

Essentially, the index is designed to support investors seeking to reduce their exposure to carbon intensity measured by weighted average carbon intensity.

It has fallen 5.4% year to date. 

iShares Core MSCI World All Cap ETF (ASX: IWLD)

IWLD ETF aims to provide investors with the performance of the MSCI World Ex Australia Custom ESG Leaders Index, before fees and expenses. 

The index is designed to measure the performance of global, developed market large and mid-capitalisation companies with better sustainability credentials relative to their sector peers.

At the time of writing it is made up of 655 holdings. The fund has fallen 5.3% for the year to date. 

The post Is now the time to buy climate focused ASX ETFs? appeared first on The Motley Fool Australia.

Investors in the Betashares Global Gold Miners Currency Hedged ETF (ASX: MNRS) will be among those paid today.

The gold miners ETF was one of the best performers of 2025, delivering a whopping total return of 149%.

MNRS tracks the performance of the Nasdaq Global ex-Australia Gold Miners Hedged AUD Index.

The 65% rally in the gold price last year, building on the 24% lift in 2024, was a big tailwind behind MNRS last year.

Investors in Betashares Global Defence ETF (ASX: ARMR) will also be paid today.

ARMR is benefitting from a big increase in global defence spending amid volatile geopolitics these days.

It tracks the VettaFi Global Defence Leaders Index and gave investors a total return of 48% last year.

Dividends to be paid today

Here are the dividends that investors will receive, rounded to two decimal places, today.

The Betashares Australia 200 ETF (ASX: A200) will pay $1.15 per unit with 60% franking.

Betashares Australian Quality ETF (ASX: AQLT) will pay 47 cents per unit with 93% franking.

The Betashares Global Defence ETF (ASX: ARMR) will pay 32 cents per unit.

Betashares Global Gold Miners Currency Hedged ETF (ASX: MNRS) will pay 3 cents per unit.

The Betashares Asia Technology Tigers ETF (ASX: ASIA) will pay 67 cents per unit.

Betashares S&P/ASX Australian Technology ETF (ASX: ATEC) will pay 6 cents per unit with 106% franking.

Betashares Diversified All Growth ETF (ASX: DHHF) will pay 30 cents per unit with 22% franking.

The Betashares Global Sustainability Leaders ETF (ASX: ETHI) will pay 4 cents per unit.

Betashares Australian Sustainability Leaders ETF (ASX: FAIR) will pay 29 cents per unit with 65% franking.

But wait, there's more…

The Betashares Geared Australian Equity Fund – Hedge Fund (ASX: GEAR) will pay 45 cents per unit with 225% franking.

Betashares Australian Dividend Harvester Active ETF (ASX: HVST) will pay 6 cents per unit with 74% franking.

The Betashares S&P Australian Shares High Yield ETF (ASX: HYLD) will pay 12 cents per unit with 66% franking.

Betashares Australian Financials Sector ETF (ASX: QFN) will pay 28 cents per unit with 89% franking.

Betashares Global Quality Leaders ETF (ASX: QLTY) will pay 9 cents per unit.

The Betashares Australian Resources Sector ETF (ASX: QRE) will pay 11 cents per unit with 101% franking.

Betashares Global Uranium ETF (ASX: URNM) will pay 3 cents per unit.

The Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX) will pay 13 cents per unit with 31% franking.

Betashares Global Banks Currency Hedged (ASX: BNKS) will pay 11 cents per unit.

Betashares Global Energy Companies Currency Hedged ETF (ASX: FUEL) will pay 9 cents per unit.

The post Own MNRS or ARMR ETFs? Here's why it's a big day for you appeared first on The Motley Fool Australia.

Investors who own these Betashares ETFs below will receive their dividends on 19 January.

The ex-dividend date is today, and the record date is Monday.

How much in dividends will you receive?

Here are the dividends that investors will receive, rounded to the nearest cent, on 19 January.

The Betashares Australia 200 ETF (ASX: A200) will pay $1.15 per unit with 60% franking.

Betashares Australian Quality ETF (ASX: AQLT) will pay 47 cents per unit with 93% franking.

The Betashares Global Defence ETF (ASX: ARMR) will pay 32 cents per unit.

The Betashares Global Gold Miners Currency Hedged ETF (ASX: MNRS) will pay 3 cents per unit.

The Betashares Asia Technology Tigers ETF (ASX: ASIA) will pay 67 cents per unit.

Betashares S&P/ASX Australian Technology ETF (ASX: ATEC) will pay 6 cents per unit with 106% franking.

Betashares Diversified All Growth ETF (ASX: DHHF) will pay 30 cents per unit with 22% franking.

The Betashares Global Sustainability Leaders ETF (ASX: ETHI) will pay 4 cents per unit.

The Betashares Australian Sustainability Leaders ETF (ASX: FAIR) will pay 29 cents per unit with 65% franking.

More ASX ETFs paying dividends soon

The Betashares Geared Australian Equity Fund – Hedge Fund (ASX: GEAR) will pay 45 cents per unit with 225% franking.

The Betashares Australian Dividend Harvester Active ETF (ASX: HVST) will pay 6 cents per unit with 74% franking.

The Betashares S&P Australian Shares High Yield ETF (ASX: HYLD) will pay 12 cents per unit with 66% franking.

The Betashares Australian Financials Sector ETF (ASX: QFN) will pay 28 cents per unit with 89% franking.

Betashares Global Quality Leaders ETF (ASX: QLTY) will pay 9 cents per unit.

The Betashares Australian Resources Sector ETF (ASX: QRE) will pay 11 cents per unit with 101% franking.

Betashares Global Uranium ETF (ASX: URNM) will pay 3 cents per unit.

The Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX) will pay 13 cents per unit with 31% franking.

Betashares Global Banks Currency Hedged (ASX: BNKS) will pay 11 cents per unit.

Betashares Global Energy Companies Currency Hedged ETF (ASX: FUEL) will pay 9 cents per unit.

Want to reinvest your ASX ETF dividends?

A distribution reinvestment plan (DRP) is available for eligible Betashares ETFs.

Betashares' registrar, MUFG Corporate Markets, must receive your DRP election by 5pm AEST on 6 January.

The post Own Betashares ASX ETFs? Here's your next dividend appeared first on The Motley Fool Australia.

I like several funds which offer investors exposure to diversified holdings which are quality businesses such as Vanguard MSCI Index International Shares ETF (ASX: VGS), Betashares Global Quality Leaders ETF (ASX: QLTY) and VanEck MSCI International Quality ETF (ASX: QUAL).

But, some investors may not want to be invested in some of the businesses in those portfolios based on the activities they're involved in.

I think the BetaShares Global Sustainability Leaders ETF (ASX: ETHI) offers investors a lot of positives. Let's get into what's appealing.

Diversification

This ASX ETF owns 200 businesses in the portfolio, which is a significant number and can provide investors with a very pleasing level of diversification with just one investment.

It's invested across a wide array of different businesses and sectors as technology, consumer discretionary, financials, healthcare, industrials and so on. Spreading our money through the different sectors is a useful strategy. This ASX ETF does that automatically for us and that's a good thing to do for almost every investor.

Diversification can allow investors to lower the risks without necessarily lowering the returns.

These businesses are chosen from across the global stock market, so it's invested in an array of countries including the US, Japan, the Netherlands, Canada, Germany, the UK, Switzerland, France, Denmark and more.

Ethical businesses

What sets this ASX ETF apart from nearly every other fund is how it goes about choosing the businesses for this portfolio.

Some funds choose businesses to be a holding based on their size, some are based on their industry, some on their quality and so on.

This fund is trying to choose companies that are, on average, seen as more ethical than other businesses.

Its portfolio invests in a portfolio of large global stocks identified as climate leaders in their industry and have also passed screens to exclude companies with direct or significant exposure to fossil fuels or engaged in activities deemed inconsistent with responsible investment considerations.

By excluding certain industries that some investors wouldn't want to own, the ASX ETF may be more palatable for every investor.

The sectors it excludes are fossil fuels, gambling, tobacco, uranium and nuclear energy, weapons and militarism, companies involved the destruction of valuable environments, animal cruelty, chemicals of concern, mandatory detention of asylum seekers, alcohol producers, human rights and payday lending.

It also doesn't invest in businesses where there's evidence of human rights violations (such as child and forced labour, bribery and corruption). The ASX ETF also avoids businesses that don't have women on the board of directors.

Great businesses

You may be concerned about what businesses are left after making all of those exclusions and whether they can deliver good performance.

Within its holdings are 200 of the best businesses in its portfolio such as Broadcom, Nvidia, Apple, Home Depot, Mastercard, Visa, Toyota, ASML, Salesforce, Arista Networks and plenty more.

The holdings can change over time, but the portfolio as a whole has performed well.

Since inception in January 2017, the ETHI ETF has returned an average of 16.8% per year.

Past performance is not a guarantee of future returns of course, but the prior returns highlight the quality of the businesses involved.

The post The ASX ETF I'd suggest buying to any family member appeared first on The Motley Fool Australia.

You might have exposure to some of the major blue-chip companies listed on the ASX. This could be a variety of the big banks, mining and materials stocks etc. 

You also know that a balanced portfolio includes stocks outside Australia. Based on this, you might have bought a fund that tracks the S&P 500 Index (SP: .INX). 

This gives you exposure to sectors less common on the ASX like technology and healthcare, as well as big global companies like Nvidia (NASDAQ: NVDA) and Apple (NASDAQ: AAPL). 

At this point, your portfolio is looking solid. 

Now you may be looking to add a small but concentrated investment in one specific sector. 

This is called thematic investing. Here are some growing themes you may be interested in targeting. 

Commodities 

Commodities are simply raw materials.

They can be precious metals like gold and silver or foodstuffs like corn and wheat and even energy resources like crude oil and natural gas.

This year, physical commodities like gold have far outpaced the returns of the ASX 200. The price of physical gold has risen more than 40%. 

This can be a strong investment for diversification because commodity prices can often move differently from share prices.

Gold has a long history of preserving its value, so investors flock to it when other financial markets get rocky. 

If you are interested in adding commodities like gold to your portfolio, some ASX ETFs to consider include: 

• Global X Physical Gold (ASX: GOLD)
• BetaShares Gold Bullion ETF – Currency Hedged (ASX: QAU)
• VanEck Gold Miners ETF (ASX: GDX)

Artificial Intelligence 

A growing theme that may interest investors is artificial intelligence.

According to Grand View Research, the global AI market is expected to grow at a compound annual growth rate (CAGR) of 38.1% from 2022 to 2030. 

AI stocks can be companies involved in chip making, software, or firms that utilise artificial intelligence in their applications.

Importantly, the ASX does not have as many AI focussed stocks as other markets. This can make AI ASX ETFs beneficial, as investors can gain exposure to innovative AI companies in the US, Asia and Europe. 

Some to consider for AI exposure include: 

• Global X AI Infrastructure ETF (ASX: AINF) 
• Global X Robo Global Robotics And Automation ETF (ASX: ROBO)
• Global X Artificial Intelligence ETF (ASX: GXAI)

ESG ASX ETFs

ESG stands for environmental, social, and governance. It is a growing theme amongst investors to target not only financial growth, but simultaneously have a positive global impact through their investment choices.

As the name suggests, this may involve targeting companies committed to contributing to climate targets, supporting human rights etc. It can also involve actively excluding companies that contribute to violence, war, alcohol/tobacco manufacturing or negatively impacting the environment. 

If this sounds like a strategy you would like to include in your investment portfolio, some ASX ETFs to consider include: 

• Betashares Australian Sustainability Leaders ETF (ASX: FAIR)
• Vanguard Ethically Conscious International Shares Index Etf (ASX: VESG)
• BetaShares Global Sustainability Leaders ETF (ASX: ETHI)
• Betashares Energy Transition Metals Etf (ASX: XMET)

The post Thematic ASX ETF investing ideas appeared first on The Motley Fool Australia.

How about the new Betashares Global Defence ETF (ASX: ARMR), which only began trading in October last year?

If you're invested in any Betashares exchange-traded funds (ETFs), today you'll be rewarded with your next lot of dividends.

Here is how much you'll receive in your bank account by the close of business on Wednesday.

Dividends for A200, NDQ and ARMR ETFs

The A200 ETF tracks the benchmark S&P/ASX 200 Index (ASX: XJO) before fees.

It provides exposure to Australia's top listed companies, including Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), and CSL Ltd (ASX: CSL).

A200 will pay $1.07576468 per unit with 56.21% franking.

ASX NDQ tracks the NASDAQ-100 Index (NASDAQ: NDX) before fees.

This ETF provides exposure to global household names like Amazon (NASDAQ: AMZN), Apple (NASDAQ: AAPL), Meta Platforms (NASDAQ: META), Nvidia (NASDAQ: NVDA), and Tesla (NASDAQ: TSLA).

The ASX NDQ will pay 49.021982 cents per unit.

The ARMR ETF seeks to track the VettaFi Global Defence Leaders Index before fees.

ARMR provides exposure to up to 60 companies that derive more than 50% of their revenue from defence equipment or services.

The ETF's top holdings are Rheinmetall AG (ETR: RHM), Palantir Technologies (NASDAQ: PLTR), and BAE Systems PLC (FRA: BSP).

ARMR ETF will pay a maiden dividend of 53.546615 cents per unit.

What about other Betashares ASX ETFs?

Here is a summary of the dividends that people invested in this selection of Betashares ETFs will receive today.

Betashares Australian Quality ETF (ASX: AQLT) will pay 78.670012 cents per unit with 45.7% franking.

The Betashares Asia Technology Tigers ETF (ASX: ASIA) will pay 2.7997434 cents per unit.

Betashares S&P/ASX Australian Technology ETF (ASX: ATEC) will pay 62.133156 cents per unit with 9.65% franking.

Betashares Diversified All Growth ETF (ASX: DHHF) will pay 27.862004 cents per unit with 21.31% franking.

The Betashares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ) will pay 28.781362 cents per unit.

Betashares Climate Change Innovation ETF (ASX: ERTH) will pay 4.524139 cents per unit.

The Betashares Global Sustainability Leaders ETF (ASX: ETHI) will pay 30.660703 cents per unit.

The Betashares Australian Sustainability Leaders ETF (ASX: FAIR) will pay 46.17632 cents per unit with 31.18% franking.

Here's a few more…

The Betashares Video Games and Esports ETF (ASX: GAME) will pay 14.695966 cents per unit.

The Betashares Geared Australian Equity Fund – Hedge Fund (ASX: GEAR) will pay 18.921508 cents per unit with 389.47% franking.

Betashares Geared U.S. Equity Fund – Currency Hedged (ASX: GGUS) will pay 87.057737 cents per unit.

The Betashares Global Cybersecurity ETF (ASX: HACK) will pay 43.465958 cents per unit.

The Betashares Australian Financials Sector ETF (ASX: QFN) will pay 21.176497 cents per unit with 57.69% franking.

Betashares Global Quality Leaders ETF (ASX: QLTY) will pay 67.851406 cents per unit.

The Betashares Australian Resources Sector ETF (ASX: QRE) will pay 10.181135 cents per unit with 82.43% franking.

Betashares Global Uranium ETF (ASX: URNM) will pay 19.732154 cents per unit.

The Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX) will pay 13.102915 cents per unit with 40.39% franking.

The post Own ASX A200, NDQ, or ARMR ETFs? It's dividend payday for you! appeared first on The Motley Fool Australia.

Investors who own these Betashares ETFs below will receive their dividends on 16 July.

According to the schedule, the ex-dividend date is 1 July, and the record date is 2 July.

Dividend pay day for Betashares ETF investors

Here is a summary of the dividend amounts that people invested in this selection of Betashares ETFs will receive on 16 July.

The Betashares Australia 200 ETF (ASX: A200) will pay $1.07576468 per unit with 56.21% franking.

Betashares NASDAQ 100 ETF (ASX: NDQ) will pay 49.021982 cents per unit.

Betashares Australian Quality ETF (ASX: AQLT) will pay 78.670012 cents per unit with 45.7% franking.

The Betashares Global Defence ETF (ASX: ARMR) will pay 53.546615 cents per unit.

The Betashares Asia Technology Tigers ETF (ASX: ASIA) will pay 2.7997434 cents per unit.

Betashares S&P/ASX Australian Technology ETF (ASX: ATEC) will pay 62.133156 cents per unit with 9.65% franking.

Betashares Diversified All Growth ETF (ASX: DHHF) will pay 27.862004 cents per unit with 21.31% franking.

The Betashares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ) will pay 28.781362 cents per unit.

Betashares Climate Change Innovation ETF (ASX: ERTH) will pay 4.524139 cents per unit.

The Betashares Global Sustainability Leaders ETF (ASX: ETHI) will pay 30.660703 cents per unit.

The Betashares Australian Sustainability Leaders ETF (ASX: FAIR) will pay 46.17632 cents per unit with 31.18% franking.

Nope, not done yet!

The Betashares Video Games and Esports ETF (ASX: GAME) will pay 14.695966 cents per unit.

The Betashares Geared Australian Equity Fund – Hedge Fund (ASX: GEAR) will pay 18.921508 cents per unit with 389.47% franking.

Betashares Geared U.S. Equity Fund – Currency Hedged (ASX: GGUS) will pay 87.057737 cents per unit.

The Betashares Global Cybersecurity ETF (ASX: HACK) will pay 43.465958 cents per unit.

The Betashares Australian Financials Sector ETF (ASX: QFN) will pay 21.176497 cents per unit with 57.69% franking.

Betashares Global Quality Leaders ETF (ASX: QLTY) will pay 67.851406 cents per unit.

The Betashares Australian Resources Sector ETF (ASX: QRE) will pay 10.181135 cents per unit with 82.43% franking.

Betashares Global Uranium ETF (ASX: URNM) will pay 19.732154 cents per unit.

The Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX) will pay 13.102915 cents per unit with 40.39% franking.

Want to reinvest your ASX ETF dividends?

A distribution reinvestment plan (DRP) is available for all of these Betashares ETFs.

Betashares must receive your DRP election by 5pm AEST on 3 July.

The post Dividend alert: What Betashares ASX ETFs are paying and when appeared first on The Motley Fool Australia.

This is a significant milestone for the exchange-traded fund (ETF) provider, which launched its first two products, the BetaShares Australian Resources Sector ETF (ASX: QRE) and the BetaShares Australian Financials Sector ETF (ASX: QFN), in 2010. Today, BetaShares offers more than 100 products across Australia and New Zealand.

Along with announcing this news, BetaShares disclosed investor preferences and trends for the year to date.

Interestingly, investors have been spreading funds roughly evenly across BetaShares' top three asset classes. International equities focused funds have attracted 33.4% of new funds, while 30.7% has been invested in Australian focused ETFs and 27.2% in fixed income ETFs.

The ASX ETF provider also revealed its top 5 most popular funds.

BetaShares Australia 200 ETF (ASX: A200)

The BetaShares Australia 200 ETF is one of BetaShares' flagship funds. As of June 2024, it was the ETF providers' most popular fund, with $7.1 billion in assets under management. The A200 ETF tracks the S&P/ASX 200 Index (ASX: XJO), providing investors with exposure to the 200 largest listed companies on the ASX. It has an ultra-low management expense of 0.04%, which is especially appealing to investors. A200 is up 42.2% over the past 5 years, which (as expected) is in line with the ASX 200 Index.

BetaShares Nasdaq 100 ETF (ASX: NDQ)

The BetaShares Nasdaq 100 ETF is the ASX ETF providers' second most popular fund. It has $5.8 billion in assets under management. For a management expense of 0.48%, NDQ ETF invests in the 100 largest non-financial companies listed on the Nasdaq. The higher management fee (relative to the A200 ETF) has been well worth it for investors, with the NDQ ETF returning 112.1% over the past 5 years

BetaShares Australian High Interest Cash ETF (ASX: AAA)

The BetaShares Australian High Interest Cash ETF is the ETF provider's third most popular fund, boasting $4.4 billion in assets under management. The AAA ETF provides exposure to Australian bank deposits, with distributions that exceed the 30-day Bank Bill Swap Rate (BBSW). Its management expense is relatively low at 0.18%. As of June 2025, this ETF offered a trailing yield of 4.4%. Distributions are paid monthly. As expected for a cash investment, the AAA ETF is flat over 5 years.

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

The BetaShares Global Sustainability Leaders ETF is BetaShares' fourth most popular ASX ETF. For a management expense of 0.59%, the ETHI ETF invests in a portfolio of large global stocks identified as "Climate Leaders". Such companies have been screened for significant exposure to fossil fuels or engaged in activities deemed inconsistent with responsible investment considerations. Over the past 5 years, ETHI has increased by 51.3%.

BetaShares Australian Hybrids ETF (ASX: HBRD)

The BetaShares Australian Hybrids ETF is the ETF provider's fifth most popular ASX ETF. Managed by fixed income fund manager Coolabah Capital, HBRD invests in Australian Bank hybrids, hybrids from other issuers, and other fixed income securities. It has $2.4 billion assets under management. As of June 2025, the 12-month distribution yield was 6.5%, making it especially attractive for those after passive income. Distributions are paid monthly. Its management expense is 0.55%, which is relatively low for an actively managed ETF.

The post BetaShares reaches $50 billion FUM: What are their 5 most popular ASX ETFs? appeared first on The Motley Fool Australia.

I believe that diversification is a very powerful tool that investors can utilise to lower risk without necessarily hurting returns. It's about not putting all of your eggs in one basket.

It's tricky for a beginner to start with diversification because buying an ASX share could mean their entire (starting) portfolio is invested in just one name.

Exchange-traded funds (ETFs) could be a smart move because of how you can buy a whole group of shares in a single transaction. It's like buying a ready-made box of shares rather than individually choosing the shares in the box.

I'll talk about two ETFs that could make good beginner ASX share investments.

Betashares Global Quality Leaders ETF (ASX: QLTY)

There are thousands of businesses on the global share market. This ETF aims to avoid most of them and only invest in the best of the best. It owns 150 global companies outside of Australia, ranked the highest on a quality score.

Being the highest quality doesn't necessarily mean incredible returns every single year, but I do think it gives a good likelihood of solid compounding returns over time.

The four factors that businesses must score well on include return on equity (ROE), debt to capital, cash flow generation ability and earnings stability. In other words, it makes good profit for shareholders, debt levels are low, real cash is flowing through the business (not just accounting profits) and the profit number doesn't usually go backwards.

Currently, that has led to the biggest positions being businesses like Netflix, Costco and Intuit.

In the last three years to 31 March 2025, the QLTY ETF has returned an average of 13.5% per year. Past performance is not a guarantee of future returns, but that's a good return and it has outperformed the S&P/ASX 200 Index (ASX: XJO). The QLTY ETF's valuation looks more appealing after dropping 9% since 14 February 2025.

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

Some new investors may be looking for beginner ASX shares that are acting ethically and sustainably for the planet and people. This fund is a great way to great businesses trying to do the 'right' thing.

It owns a portfolio of large, global businesses that have been identified as climate leaders and also passed screens to avoid companies with exposure to certain industries deemed as less ethical.

The ETHI ETF is not invested in businesses involved in fossil fuels, gambling, tobacco, weapons, destruction of valuable environments, animal cruelty, concerning chemicals, alcohol production, junk food, payday lending or pornography. There should also not be evidence of human rights violations, and they should have at least one woman on the board of directors.

Some of the businesses that currently pass these screens and are the most significant holdings in the portfolio include Apple, Visa, Nvidia and Mastercard. It has a total of around 200 positions.

Investors looking for good beginner ASX shares will be pleased to know this fund has also performed well – in the three years to 31 March 2025, it returned an average of 13.4%. But, its price looks better after falling 12% from 31 January 2025.

The post 2 beginner ASX shares I'd snap up today appeared first on The Motley Fool Australia.

This diversification can help spread risk. However, ETFs are still not immune to a market downturn, as we've experienced in 2025. 

At the time of writing, the S&P/ASX 200 Index (ASX: XJO) is down 4.66% since the beginning of 2025. 

The S&P 500 Index (SP: .INX) is down almost 10% and the NASDAQ-100 Index (NASDAQ: NDX) is down more than 12%. 

While it's impossible to know if we have hit the bottom of this economic downturn, it does mean quality ETFs that track these markets have also fallen significantly. 

Here at The Motley Fool we are less about trying to perfectly predict the beginning and end of a bear market and more about investing in quality holdings with a long term outlook. 

The Motley Fool's Chief Investment Officer in Australia Scott Phillips has repeatedly emphasised that over 120 years, The ASX and US market have never failed to regain, then surpass, a previous high after an economic crisis. 

So if you are looking long-term, here are three ASX ETFs that could be undervalued after a down start to the year. 

Vanguard MSCI Index International Shares ETF (ASX: VGS)

This ETF is one of the most traded in Australia and includes companies from around 23 different countries including the U.S, Japan, U.K, Canada, France, and Switzerland.

It actively excludes Australia, which could benefit investors with high exposure to just the Australian market. 

It currently includes more than 1,300 holdings. 

Its largest holdings are largely US focussed and include Apple (NASDAQ: AAPL), Nvidia (NASDAQ: NVDA), and Microsoft (NASDAQ: MSFT). 

So far this year it has fallen 8.62%. 

However, it has provided steady returns for long term holders, up 66.23% in the last five years. 

That means hypothetically, $10,000 invested in VGS five years ago would be worth $16,623.00. 

This doesn't take into account dividends or reinvested earnings. 

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

This ETF could appeal to investors focussed on impact investing which is an investment strategy on the rise in Australia. 

It involves focussing on advancing particular social or ethical causes while still being able to generate financial returns. 

According to the fund, ETHI aims to track the performance of an index (before fees and expenses) that includes a portfolio of large global stocks identified as "Climate Leaders". 

These stocks have also passed screens to exclude companies with direct or significant exposure to fossil fuels or engaged in activities deemed inconsistent with responsible investment considerations.

Since the start of the year, the fund is down 9.54% but remains up 42.16% over the last 5 years. 

BetaShares NASDAQ 100 ETF (ASX: NDQ)

For investors looking for exposure to US markets after a down start to the year, NDQ could be worth considering. 

The BetaShares NASDAQ 100 ETF tracks the performance of the 100 largest non-financial companies listed on the Nasdaq market. 

Like VGS, its three largest holdings are Apple (NASDAQ: AAPL), Nvidia (NASDAQ: NVDA), and Microsoft (NASDAQ: MSFT). 

However, these companies represent a much larger portion of the fund. This means holders will be more exposed to rises and falls from these blue-chip stocks.

It has fallen 14.35% since the start of the year. However has brought investors strong long term growth, up 81.48% over the last 5 years. 

The post Bargain hunting: Which ASX ETFs have fallen the most in 2025? appeared first on The Motley Fool Australia.

I think diversification within an ETF investment makes it much easier to stick with that ASX ETF because the combination of holdings is lower risk than just owning one business.

Additionally, as newer businesses succeed, they become a greater part of the fund's holdings, ensuring the ASX ETF's holdings remain relevant and the overall fund is future-proofed.

With that in mind, I like the two ASX ETF options below.  

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

This fund aims to invest in a diversified portfolio of large, sustainable, and ethical companies from a range of markets.

It starts with all of the businesses from the global share market and then makes a number of exclusions. For example, it excludes fossil fuels, gambling, tobacco, weapons, alcohol companies, payday lending, and so on. The ETHI ETF then owns the 200 largest climate-leading businesses that pass through all of those screenings.

I think 200 holdings is a large enough number for diversification, and they come from a variety of places, including the US, Japan, the Netherlands, the UK, Denmark, Canada, and so on.

This ASX ETF could be an appealing pick for investors who only want to make investment returns from companies that deliver a certain level of 'ethics' for their portfolio.

This fund's largest holdings are currently Nvidia, Apple, Visa, Mastercard, and Home Depot.

Coincidence or not, this fund has performed strongly, showing that owning ethical companies doesn't necessarily detract from returns. In the five years to 31 January 2025, the ETHI ETF has returned an average of 16.1%.

Vanguard Msci Index International Shares ETF (ASX: VGS)

For people who just want to invest in the global share market without necessarily making ESG investment decisions, the VGS ETF could be one of the most effective ways to go.

It's invested in more than 1,300 businesses from a wide range of major developed countries, including the US, Japan, the UK, Canada, France, Switzerland, Germany, the Netherlands, Sweden, Italy, Spain, Denmark, Hong Kong, Singapore, Finland, Belgium, Israel, Norway, and Ireland.

Companies are always trying to grow their profits over the long term, and they are giving themselves a great shot at growing their underlying value over time.

The businesses in this portfolio are typically the leader in their country at what they do, and the biggest holdings are among the strongest and most dominant in the world. The holdings include Apple, Microsoft, Amazon, Alphabet, Meta Platforms, Tesla, Broadcom, JPMorgan Chase and Eli Lilley.

Considering the amount of global diversification, I think the annual management fee is very reasonable at 0.18%.

The low cost and exposure to good businesses have helped the ASX ETF achieve net returns of an average of 13.9% per year over the past five years.  

The post 2 top ASX ETFs I'd buy for my family appeared first on The Motley Fool Australia.

Owning 50 individual businesses in a portfolio would probably be seen as diversified, but would owning just one ASX ETF count, too?

There are many different options to consider, such as ETFs that give exposure to Australian shares, global shares, US shares, European shares, Asian shares, or perhaps a specific industry or theme.

Would it be wise to have most or all of my portfolio invested in just one ASX ETF, and how would I choose what to look for?

Risk diversification is important

How the ETF's capital is allocated is important for how suitable an investment it could be.

For example, I wouldn't choose an ASX ETF that only invests in banks because they're all exposed to similar risks.

I'd only want to pick an ETF that offered diversified exposure to various sectors.

The ultimate diversification options could be funds that invest in a wide array of areas.

For example, the Vanguard Diversified High Growth Index ETF (ASX: VDHG) invests in various funds that include ASX shares, emerging market shares, small international shares, large international shares, and some bond exposure.

The BetaShares Diversified All Growth ETF (ASX: DHHF) is similar in that it invests in a mix of ASX shares, emerging markets, US shares, and non-US developed markets.

It's certainly possible that an investment like one of these shares-focused funds could be someone's entire portfolio because of the large amount of diversification.

However, for my own portfolio, I think these funds offer almost too much diversification and can lower potential investment returns. I do like what the DHHF ETF brings to the table, though, as an all-shares pick.

My preferred ASX ETFs

I think the funds that could be the right options, for me, with huge allocations are ones invested in the global share market with diversified holdings. The ASX share market ETFs are good, but the ASX only accounts for around 2% of the global share market, so there are plenty of good companies worth owning outside of Australia.

I'd want to choose funds that own a large number of shares but also that the typical business within those funds is good quality to help deliver long-term profit growth and returns.

I'm thinking of ideas such as Vanguard MSCI Index International Shares ETF (ASX: VGS), VanEck MSCI International Quality ETF (ASX: QUAL), Betashares Global Quality Leaders ETF (ASX: QLTY), BetaShares Global Sustainability Leaders ETF (ASX: ETHI) and possibly iShares S&P 500 ETF (ASX: IVV). I'd be willing to have most of my portfolio invested in one of these funds, but that approach may not be right for everyone.

Of course, it's probably a good idea to have investments in more than just one fund. That's why my portfolio also has ASX growth shares and ASX dividend shares. But, I'd be very happy to regularly buy one of the ETFs I've mentioned, which I plan to do with the QUAL ETF.

The post How much of my portfolio would I invest in one ASX ETF? appeared first on The Motley Fool Australia.

We need to work to generate earnings, whether as regular employees, small business owners, or CEOs of Australia's biggest companies.

Dividends require no extra effort to receive $10,000 compared to $1,000. They're a very scalable type of income.

So, how do we unlock bucketloads of cash? There are a few steps I'd follow.

Identify the goal and start saving

Each household has its own income level, so it's difficult to say what the target should be exactly.

However, the Australian Bureau of Statistics (ABS) recently told us that the median weekly earnings of Australian employees in their main jobs were $1,396, so I think a goal of $75,000 would be a good annual target.

Obviously, we can't go from $0 to instantly earning $75,000 in passive dividend income. We'll need to start saving some money to invest and begin compounding our portfolio to a much larger figure.

Each household needs to figure out how much they can or want to set aside for investing.

Invest and compound

I'm going to use a very round figure to demonstrate the power of sticking with a goal and regularly investing.

If you invested $1,000 per month for 30 years and it grew by an average of 10% per year (the ultra-long-term return on the share market), it would become worth $1.97 million! Someone who is 22 today could see their portfolio become almost $2 million by the age of 52.

Of course, investing more per month and/or the portfolio returning more than 10% could deliver $2 million even quicker and help unlock that passive income. For example, investing $2,000 per month and returning 10% per annum would grow into $2.1 million after less than 24 years.

Patience is required, but these numbers show how ASX shares can reach much larger numbers over time. In my first example of investing $1,000 per month, $1.6 million of the $1.97 million was made by portfolio returns – only $360,000 of the amount was from contributions of our own money.

Where to invest?

The easiest way to invest could be to pick exchange-traded funds (ETF) that give investors a diversified portfolio in a single investment. I believe international shares could be the way to go because those companies typically have their eyes on a global earnings growth runway, giving them a lot of room to expand.

Some ASX ETFs to consider could be Vanguard MSCI Index International Shares ETF (ASX: VGS), VanEck MSCI International Quality ETF (ASX: QUAL), Betashares Global Quality Leaders ETF (ASX: QLTY), BetaShares Global Sustainability Leaders ETF (ASX: ETHI) or VanEck Morningstar Wide Moat ETF (ASX: MOAT).

If you reached $2 million, or less if the goal is a lower annual passive income amount than $75,000, then you could create cash flow by selling a small portion of the portfolio balance.

To get $75,000 per year with $2 million, you would need to sell 3.75% of the portfolio balance each year. The long-term capital growth of the ETFs could end up being stronger than 3.75% in future years, so investors could become wealthier as time goes on.

Of course, I'm a firm believer in the potential of ASX growth shares and ASX dividend shares for returns. Depending on the dividend yield, owning ASX dividend shares for passive income could also be a smart move once an investor reaches the desired portfolio value.

The post Want to earn more passive income from ASX shares than your job? Here's how I'd do it appeared first on The Motley Fool Australia.

There are thousands of businesses listed on the ASX to choose from, and many different opinions suggest which ones are the best investments.

We don't need to find the next Microsoft, Amazon, or Nvidia to grow our wealth at a pleasing pace. The ASX share market has delivered an average return per year of close to 10% over the ultra-long term. That level of return can double $1,000 into $2,000 in less than eight years and then $2,000 into $4,000 in less than eight years after that.

We also don't need to behave like fund managers with our portfolios to try to find the absolute best value companies. There are some great investment tools out there, such as exchange-traded funds (ETFs), that can help our wealth grow with a simple strategy.

Exchange-traded funds

Anyone can utilise exchange-traded funds for their portfolios. It enables people to buy a group of shares in a single investment. Different ETFs target different shares or assets.

For example, there are ETFs aimed at ASX shares, US shares, global shares, European shares, Asian shares, property or even bonds.

There are a few ETFs out there that own a whole bunch of different funds within them – a fund of funds. They offer a lot of diversification – examples include the Vanguard Diversified High Growth Index ETF (ASX: VDHG) and the BetaShares Diversified All Growth ETF (ASX: DHHF).

Investors can also choose to invest in all-share ETFs that are focused on the global share market. This market is home to many of the best businesses, which make huge profits, have strong competitive advantages, and deliver impressive profit margins.

If I were starting to invest in ASX shares, I would choose to invest in great ASX ETFs such as the Vanguard MSCI Index International Shares ETF (ASX: VGS), the BetaShares Global Sustainability Leaders ETF (ASX: ETHI), and the BetaShares Global Quality Leaders ETF (ASX: QLTY). These ETFs offer a useful combination of diversification and strong long-term returns.

But it's not the only way to invest.

ASX blue-chip shares

Aussies can also decide to start investing their money into strong companies that they recognise. That could be reassuring for investors.

Blue-chip companies can be industry leaders that have major size and brand benefits compared to smaller competitors.

It may be reassuring to invest in companies that we know and perhaps even use in everyday life. But, I would only want to invest in businesses that have appealing growth potential.

For example, Telstra Group Ltd (ASX: TLS) is the country's biggest telco and continues to win subscribers and deliver stronger underlying mobile profit margins.

Wesfarmers Ltd (ASX: WES) owns Kmart, Bunnings, and Officeworks, among other impressive businesses. It continues to grow its profit as it attracts more customers.

Goodman Group (ASX: GMG) is building a global portfolio of industrial properties, including data centres.

REA Group Ltd (ASX: REA) owns realestate.com.au and is rapidly expanding in India. Whether someone starts investing in ASX shares with ETFs or individual companies, the stock market can help build wealth for the long term.  

The post Want to start investing in ASX shares? Here's what I'd buy appeared first on The Motley Fool Australia.

What do they have in common? They are all examples of impact investing, a strategy whereby investors focus on advancing particular social or ethical causes while still being able to generate financial returns. This investment style is undoubtedly on the rise.

The 2023 ASX Investor Study showed that 31% of investors were environmentally, socially, and governance (ESG) conscious. The report also found that 23% of investors bought or sold an investment based on environmental factors during that year. 

In 2024, ethical ASX ETFs showed investors that they can have their cake and eat it, too, enjoying strong gains through ethical funds. Let's take a closer look.

Ethical shmethical

Making financial decisions with the goal of contributing positively to the planet is a noble cause. It's also important to recognise how these ETFs are actually constructed. 

Different ethical ETFs use different strategies. Some ETFs actively include specific types of holdings to build their portfolio, such as targeting climate leaders in a certain industry.

Other ETFs use a strategy of actively excluding specific companies based on established criteria. 

For example, an ETF may exclude companies that negatively impact the environment. Or it might exclude companies linked to fossil fuels, nuclear power, tobacco or weapons. 

I'm not here to rain on anyone's parade, but I do think it's important for investors to decide for themselves how they interpret 'ethical' and 'sustainable' when it comes to their personal investment choices. 

With that in mind, these ethically conscious ETFs had strong gains in 2024. 

Vanguard Ethically Conscious International Shares Index ETF (ASX: VESG)

One-year return: 28.9%

This ASX ETF excludes companies that have a specified level of business involvement in fossil fuels, nuclear power, alcohol, tobacco, cannabis, gambling, adult entertainment or weapons.

Due to its screening process, it has a large exposure to the US technology sector. Its largest holdings are Apple, Nvidia Corp, Microsoft and Amazon. 

These holdings are likely to have influenced its strong performance in 2024, given this year's monster rally in tech and artificial intelligence shares.

This ETF might particularly interest investors looking to invest in some of the largest, ethically conscious companies based outside Australia. 

Betashares Global Sustainability Leaders ETF (ASX: ETHI)

One year return: 23.4%

The ETHI ETF aims to track the performance of an index that includes a portfolio of large global stocks identified as climate leaders. Similar to other ethical ETFs, ETHI excludes companies with direct or significant exposure to fossil fuels, gambling, tobacco, animal cruelty and weapons. 

This ASX ETF then goes a step further by excluding companies with human rights concerns or gender inequality. For example, the fund excludes McDonald's because the "majority of revenue comes from the sale of junk food" and Tesla as it's "implicated in workplace relations-related controversies".

The fund consists of the 200 largest companies that fit this criteria. Its strong performance in 2024 was influenced by strong growth from significant holdings such as Apple, NVIDIA, Visa, and Mastercard.

Vanguard Ethically Conscious Australian Shares ETF (ASX: VETH)

One year return: 12.01%

The VETH ETF excludes the securities of companies that have a specified level of business involvement in fossil fuels, nuclear power, alcohol, tobacco, cannabis, gambling, adult entertainment or weapons. 

It has a large exposure to the Australian financial sector, with the Big Four ASX banks comprising more than 25% of holdings. This has largely influenced its strong returns this year.

VETH might not consist solely of companies dedicated to sustainability or climate action, but it may interest investors looking for significant exposure to ASX bank shares while avoiding specific mining or gambling companies that may be included in other ASX 200 or 300 tracking ETFs. 

The post Which 3 ethical ASX ETFs performed the best in 2024? appeared first on The Motley Fool Australia.

I think Aussie investors benefit from exposure to the international share market because of the broad range of businesses available outside of Australia.

After all, the ASX share market only accounts for around 2% of the global share market, so it'd be worthwhile to have exposure to some of the other 98%.

And global blue-chip shares appear to have a stronger earnings growth outlook right now than the major blue-chip shares here in Australia, such as the ASX miners and banks.

However, because of how the portfolio is assembled, the BetaShares Global Sustainability Leaders ETF is more than a simple global ASX-listed ETF. Let's take a look.

Ethical screening

Plenty of businesses making big profits around the world come from sectors that some Aussies may not want to be invested in, such as fossil fuels, tobacco and gambling.

The ETHI ETF examines the global share market and conducts several ethical screenings. What remains are the 200 largest 'ethical' businesses classified as climate leaders, as well as a broad range of environmental, social, and governance (ESG) criteria.

According to BetaShares, companies in the BetaShares Global Sustainability Leaders ETF portfolio have no investment exposure to fossil fuel reserves, while 100% of the power generated by the companies involved comes from renewable sources.

The ETF has deemed a number of industries and activities "inconsistent with responsible investment considerations".

Other industries it avoids include gambling, tobacco, uranium and nuclear energy, armaments and militarism, involvement in animal cruelty, chemicals of concern, production of alcohol, payday lending and more.

It also rules out businesses that have no women on the board of directors and companies where there's evidence of human rights violations such as child labour, sweatshops or bribery.

High-quality holdings

After making all those exclusions, what remains within the ASX ETF is, in my view, a high-quality list of companies that are among the global leaders in what they do. These companies already generate strong earnings and have the potential to make plenty more profit in the coming years.

Some of the largest holdings may be very recognisable to many people:

• Nvidia (6% of the portfolio)
• Apple (5.2%)
• Mastercard (4.1%)
• Home Depot (4%)
• Visa (3.9%)
• Toyota Motor (2.6%)
• UnitedHealth (2.1%)
• ASML (1.9%)
• Comcast (1.9%)
• Adobe (1.7%)

Curiously, the ETHI ETF portfolio of ethical companies' returns has been very good for investors.

Great returns by the ASX ETF

BetaShares Global Sustainability Leaders ETF has been a strong-performing fund while also offering good diversification.

Looking at the current sector allocation of the ASX ETF, there are four with double-digit weightings: IT (31.1%), financials (23.3%), healthcare (15.9%), and consumer discretionary (14.3%). Of all the sectors, I'd want the biggest allocation to be IT companies because of their ability to achieve high profit margins and grow earnings faster than other sectors.

Past performance is not a reliable indicator of future returns, but since inception in January 2017 the ETHI ETF has returned an average of 17.2%. It has done well, and it wouldn't surprise me if the fund is able to continue outperforming the S&P/ASX 200 Index (ASX: XJO) over the long term with the global earnings growth outlook for these businesses.

The post Looking for diversification and growth? This ASX ETF could be the answer appeared first on The Motley Fool Australia.

Australia is a great country. But, the ASX share market only accounts for a small part, around 2%, of the global stock market.

There are some impressive ASX companies, such as CSL Ltd (ASX: CSL), Wesfarmers Ltd (ASX: WES), Goodman Group (ASX: GMG), WiseTech Global Ltd (ASX: WTC), and Xero Ltd (ASX: XRO).

However, the ASX share market is largely weighted to two industries: ASX financial shares and ASX mining shares. Looking at the A200 ETF portfolio, financials currently make up 33% of the portfolio, and miners account for 19.3% of the portfolio.  

With that much industry concentration within the A200 ETF fund and limited global earnings generation by the average ASX company, I think it could be a good idea to look for international diversification.

Usually, I'd discuss options like the Vanguard MSCI Index International Shares ETF (ASX: VGS) and the Betashares Global Quality Leaders ETF (ASX: QLTY), but today, I'm going to focus on two other compelling ASX ETFs that give exposure to specific themes.

Betashares Global Cybersecurity ETF (ASX: HACK)

Some sectors can give investors exposure to strong growth tailwinds.

I think cybersecurity is one of the best areas to invest in because of how integral it is for businesses, governments, and households to utilise it.

I believe that even if a global recession were to occur, cybersecurity would still be in strong demand because governments and businesses need to protect important data, log-in information, transaction details, intellectual property, and so on.

According to Statista, cybersecurity revenue is expected to show a compound annual growth rate (CAGR) of 7.9% between 2024 and 2029, resulting in a market volume of US$271.9 billion by 2029.  

Due to the software nature of these businesses, the profit margins could increase in the coming years as more subscribers sign up.

The world is becoming more digital in numerous ways, such as e-commerce and banking. Globally, I think there is plenty of earnings growth for this group of businesses.

According to Betashares, the HACK ETF has returned an average return per year of 16.3% over the five years to August 2024. Of course, past performance is not a guarantee of future returns.

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

Some investors may want to avoid owning businesses from certain sectors that behave unethically.

While avoiding certain companies doesn't stop them from operating, owning ETHI ETF units can at least mean investors aren't profiting from the companies that don't match their ethics.

The ETHI ETF avoids a number of areas, including fossil fuels, gambling, tobacco, armaments and 'militarism', animal cruelty, and payday lending. It also avoids companies with human rights concerns and ones that lack board diversity.

It's invested in 200 large global businesses that pass all of those ethical screens. Those businesses are from a variety of countries including the US, Japan, the Netherlands, Denmark and the UK.

Some of the largest positions in the portfolio include Nvidia, Apple, Mastercard, Home Depot and Visa. Past performance is not a reliable indicator of future performance, but over the past five years the ETHI ETF has returned an average of 16.8% per annum.

The post Overinvested in the BetaShares Australia 200 ETF (A200)? Try these 2 ASX ETFs appeared first on The Motley Fool Australia.

Imagine having all your money invested in ASX travel shares at the start of the pandemic. Or your life savings in bank stocks when the Global Financial Crisis hit.

Is that enough said on why diversification is important?

Next question: How many ASX stocks are ideal to achieve good diversification in your portfolio?

Let's find out.

How many ASX stocks make the perfect portfolio?

Holding a number of ASX stocks from different sectors tends to smooth out your returns because it allows the sectors that do well to offset the sectors that do not in any given year.

If you have geographic diversification, meaning ASX stocks, some US shares, and some other international stocks, then you can also benefit from the economies that do better than others each year.

But investors can also go too far with diversification.

Famous United States investor Peter Lynch came up with the term 'diworsification' to highlight the risks of having your money spread too thinly across too many stocks.

This worsens your portfolio's risk-return trade-off, according to advice published on asx.com.au.

What do the experts think?

In a new article, the ASX presents the views of several market experts on how best to build a portfolio of stocks with adequate diversification.

Rachel Waterhouse, CEO of the Australian Shareholders' Association (ASA), said:

I've met with some ASA members who only own one stock and thus have no diversification, and others who own 40-50 stocks, which is too many. I've heard some members say 10-20 stocks is ideal, but there's no magic number for diversification.

Waterhouse points out that investors who choose to buy individual ASX stocks need to monitor them.

She said:

I don't think investors can properly monitor 40-50 stocks in their portfolio unless they are prepared to be stuck at a desk for 12 hours a day. Even then, there's only so many stocks that one can get their head around.

Here at The Fool, we recommend buying 15 to 25 stocks to create an adequately diversified portfolio.

Are ASX ETFs the way to go for easy portfolio diversification?

Index ETFs like the BetaShares Australia 200 ETF (ASX: A200), which tracks the S&P/ASX 200 Index (ASX: XJO), or the Vanguard Australian Shares Index ETF (ASX: VAS), which tracks the S&P/ASX 300 Index (ASX: XKO), make diversification easy for investors who don't want to research individual ASX stocks.

Some investors also choose international index ETFs like the iShares S&P 500 AUD ETF (ASX: IVV), which tracks the S&P 500 Index (SP: .INX), or the Vanguard US Total Market Shares Index ETF (ASX: VTS), which tracks the CRSP US Total Market Index (NASDAQ: CRSPTM1), which is comprised of 3,700 US stocks.

By choosing index ETFs, investors accept that they can only ever hope for average market returns less fees. But those average returns are incredibly good, just quietly.

Vanguard says the ASX All Ords has delivered an average 9.2% annual return over the past 30 years, while the S&P 500 has delivered 10% per annum over the same timeframe.

Gemma Dale, Director of SMSF and Investor Behaviour at nabtrade, says many customers buy ASX ETFs, but they do so for different reasons, depending on their age.

Dale said:

Older customers tend to invest in ETFs for exposure to international shares or other asset classes, having already built a portfolio of Australian shares through direct investing. For them, adding ETFs is about achieving asset allocation in portfolios.

Younger nabtrade customers are increasingly investing for the first time through ETFs. Interestingly, a great proportion of younger nabtrade customers now start with an ETF over the S&P/ASX 200 index and then build their portfolio up slowly from there.

A warning on index funds tracking ASX 200 stocks

While index investing certainly provides diversification, some indexes have heavy sector concentration.

The ASX 200 is one of them, with financial and resources stocks comprising 52% of the index on 30 June.

So, this is something to be aware of, but as Betashares investment strategist Tom Wickenden points out, you can also offset it.

Wickenden says the Betashares Nasdaq 100 ETF (ASX: NDQ), which tracks the NASDAQ-100 Index (NASDAQ: NDX), is particularly complementary to ASX 200 index ETFs.

This is because the NASDAQ 100 and ASX 200 have opposite sector weightings.

The ASX 200 comprises 30.6% financial shares, 22.7% materials shares, and only 3.2% tech stocks. In contrast, the NDQ ETF has only 1.5% materials shares, 0.5% financial shares, and 50.5% tech stocks.

Adam DeSanctis, Head of ETF Capital Markets Asia-Pacific at Vanguard Australia, says there are four key principles for portfolio diversification: goals, balance, cost, and discipline.

He says investors need clearly stated goals, balanced asset allocation appropriate to those goals, a focus on minimising portfolio costs, and the discipline to maintain their investment approach.

What other types of diversification are possible?

There are other types of diversification offered by ASX ETFs besides sector and geographical.

For example, investors can choose ETFs that cater to specific thematics, such as environmental, social, and corporate governance (ESG), with offerings such as the BetaShares Global Sustainability Leaders ETF (ASX: ETHI).

Investors can also choose ETFs that focus on types of businesses, such as those with major competitive advantages. An example of this is the VanEck Morningstar Wide Moat AUD ETF (ASX: MOAT).

The post How many ASX stocks should you have in your portfolio? appeared first on The Motley Fool Australia.

It's been a great period of time for the ASX bank share, but there's a big difference between the returns of the shares compared to the performance of the underlying financials of the bank.

It's rare for a bank the size of CBA to deliver capital growth of more than 20% in one year. Unless earnings grow at the same speed as the share price or faster, the price/earnings (P/E) ratio will increase, and the company will appear more expensive.

In my view, today's CBA share price valuation will either need to be justified by higher earnings or else there could be a pullback. Market volatility is completely normal of course, as there are always different buyers and sellers in the market. But what can we do to protect our portfolios from specific stock risk?

Diversification

I believe it's very easy to create diversification within our portfolios.

Diversification can help lower the risk of being too exposed to a particular business or sector.

If CBA was someone's entire portfolio and it dropped 20%, their portfolio would be worth 20% less.

If CBA was only 10% of a person's portfolio, a 20% decline in the CBA share price would only mean a 2% decline in the portfolio value.

Of course, that doesn't mean spreading your capital across Westpac Banking Corp (ASX: WBC), ANZ Group Holdings Ltd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) because those other banks are in the same industry.

If I were buying individual ASX blue-chip shares, I'd look at names like Telstra Group Ltd (ASX: TLS), Rio Tinto Ltd (ASX: RIO), Wesfarmers Ltd (ASX: WES), Coles Group Ltd (ASX: COL) and Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) because they all offer different industry exposure to CBA shares.

Go global

An even better strategy to achieve diversification and avoid the risks of being overexposed to CBA shares is to invest in exchange-traded funds (ETFs).

ETFs allow us to buy a basket of shares in a single transaction. Each ETF has a different portfolio, so I think it's worthwhile being selective about which fund to go with.

If I already owned a lot of CBA shares, I wouldn't jump to buy Vanguard Australian Shares Index ETF (ASX: VAS) because it has a large allocation to ASX bank shares. I believe there are better options for diversification.

I'd look at globally focused ETFs, which, thanks to the quality of the underlying businesses, can provide both diversification and, hopefully, good returns.

Some of my favourites include VanEck MSCI International Quality ETF (ASX: QUAL), Betashares Global Quality Leaders ETF (ASX: QLTY), BetaShares Global Sustainability Leaders ETF (ASX: ETHI), and Vanguard MSCI Index International Shares ETF (ASX: VGS).

CBA is a great business, but there are plenty of others worth owning too, in my opinion. Choosing compelling global ETFs means we can spread our money across hundreds of businesses.

The post One day, CBA shares will go down. Here's how to keep it from hurting your portfolio appeared first on The Motley Fool Australia.