History tells us that the S&P/ASX 200 Index (ASX: XJO) returns an average of 9-10% per annum. 

That's nothing to complain about. 

However, it's important to understand that returns aren't linear. Rather, it isn't as simple as 9% every year. 

This year, statistically, has been a softer one for the ASX 200. 

At the time of writing, with a couple weeks left to go in the year, Australia's benchmark index has risen roughly 4.7%. 

This is well below some other markets around the world. 

So for investors looking to diversify beyond the Australian market, here is how a hypothetical investment in some overseas markets would have performed in 2025. 

Betashares Capital Ltd – Asia Technology Tigers Etf (ASX: ASIA)

This ASX ETF aims to track the performance of an index (before fees and expenses) comprising the 50 largest technology and online retail stocks in Asia (ex-Japan). 

This includes global names like Samsung Electronics and Alibaba. 

It also offers heavy exposure to the growing semiconductor industry fuelling the AI boom.

It's no surprise that exposure has helped this fund grow significantly in 2025. 

Since the start of the year, it is up 37.82%. 

That means a $10,000 investment at the start of the year would today be worth $13,782 today. 

Global X Euro Stoxx 50 ETF (ASX: ESTX)

As the name suggests, this ASX ETF invests in 50 of the largest companies across the eurozone.

This includes global blue-chips like Dutch multinational corporation and semiconductor company ASML Holding N.V. (ENXTAM: ASML) and German software company SAP (ETR: SAP). 

Some of the best performing markets in 2025 have been in Europe. 

By country, the fund has its largest weighting towards: 

• France 33.88%
• Germany 29.98%
• Netherlands 14.93%

This ASX ETF has risen 24.6%, which means an investment of $10,000 at the start of the year would already be worth $12,460. 

Betashares FTSE100 ETF (ASX: F100)

Just across the pond lives the London Stock Exchange. 

This ASX ETF tracks the performance of the FTSE 100 Index (before fees and expenses), which provides exposure to the largest 100 companies by market capitalisation traded on the London Stock Exchange.

This fund includes U.K based global leaders such as HBSC, Diageo and Unilever.

It has risen an impressive 21.10% this year. 

That would have brought an investment of $10,000 in January to a healthy $12,110 right now. 

The post Guess how much $10,000 invested a year ago in these global ASX ETFs is worth today appeared first on The Motley Fool Australia.

To be fair, it's been an exceptional few years to have been invested in most stock markets, or more accurately, in the funds that track them, around the world. To illustrate, the S&P/ASX 200 Index (ASX: XJO) has delivered a stellar return of 12.97% per annum (that's share price growth plus dividends) over the three years to 31 August 2025. That's well above the long-term average of about 8.7% per annum.

However, a few ASX index funds have done even better than that. Let's check them out.

3 ASX index funds that have hit 15% per annum or more over the past three years

iShares S&P 500 ETF (ASX: IVV)

It's well known that the US markets have been a particularly lucrative hunting ground for returns in recent years, thanks to the stunning, AI-driven successes of its largest constituents. The likes of Nvidia, Alphabet, Microsoft and, Tesla have been minting new records at a seemingly unstoppable pace in recent years, particularly so in 2025.

This has helped drive the returns of the broader US markets. Reflecting this, the iShares S&P 500 ETF, an ASX index fund that tracks the flagship American S&P 500 Index (SP: .INX), has delivered an extraordinary return of 21.1% per annum over the three years to 31 August 2025.

iShares MSCI Japan ETF (ASX: IJP)

To another market and another ASX index fund now, it's time to check out the iShares MSCI Japan ETF. This fund tracks the MSCI Japan Index, which covers about 85% of the stocks listed on the Tokyo Stock Exchange. Readers will be familiar with many of IJP's top holdings, which include the likes of Toyota, Sony, Softbank, Nintendo, and Mitsubishi Heavy Industries.

This index has been on fire in recent years. Finally shaking off the infamous 'lost decade' in the 2020s, the iShares Japan ETF has returned an average of 17% per annum over the three years to 31 August.

BetaShares FTSE 100 ETF (ASX: F100).

Our final ASX index fund worth considering today is this Betashares fund. The Betashares FTSE 100 ETF tracks the FTSE 100 Index, which measures the performance of the largest 100 stocks listed on the London Stock Exchange. Again, many of F100's top holdings are household names in Australia, including HSBC Holdings, AstraZeneca, Shell, Unilever, and British American Tobacco.

This ASX index fund is our highest flyer on this list. It has delivered a euphoric return of 19.05% per annum over the three years to 31 August 2025.

The post These ASX index funds have returned at least 15% per annum since 2022 appeared first on The Motley Fool Australia.

But how can we create that cash flow of investment income? Buying a property can require tens of thousands of dollars. It could take a long time to save that much.

The great thing about investing in ASX shares is that we don't need to save a ton to be able to start investing. In fact, some brokers allow us to start investing with as little as $500.

I wouldn't necessarily try to find something that has the biggest dividend yield around because those sorts of businesses don't typically have a reputation for long-term stability or continuous growth. There are lower-risk investments we can buy to start making ASX passive income for our portfolios.

Individual ASX shares

Australian companies are some of the most appealing businesses for dividends because of both the franking credits and the generous dividend payout ratios (to distribute those franking credits for shareholders).

I'd only want to invest in businesses that have a compelling long-term future, where earnings growth seems likely and that can assist dividend growth.

I'm thinking of businesses such as investment conglomerate Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), property owner Centuria Industrial REIT (ASX: CIP), water entitlement owner Duxton Water Ltd (ASX: D2O), telco Telstra Group Ltd (ASX: TLS), funds management business GQG Partners Inc (ASX: GQG) and Kmart and Bunnings owner Wesfarmers Ltd (ASX: WES).

I think there's a very good chance of the above businesses growing their annual payouts regularly in the coming years.

Exchange-traded funds

Exchange-traded funds (ETFs) can be effective options for ASX passive income because of how they enable investors to buy a portfolio of businesses in just a single investment, which is a great tool for diversification.

If investors want a portfolio of large ASX shares then there are a couple of options. There's one that let Aussies invest in dozens of high-yielding ASX businesses – Vanguard Australian Shares High Yield ETF (ASX: VHY).

The Vanguard Australian Shares Index ETF (ASX: VAS) allows Aussies to invest in the S&P/ASX 300 Index (ASX: XKO), which includes those higher-yielding names too, such as Rio Tinto Ltd (ASX: RIO), National Australia Bank Ltd (ASX: NAB) and Westpac Banking Corp (ASX: WBC). The VAS ETF also owns businesses better suited for capital growth.

There are other ETFs that can also provide a good dividend yield level, including Betashares FTSE 100 ETF (ASX: F100) and Betashares India Quality ETF (ASX: IIND), which provide exposure to the UK and India share markets, respectively.

Listed investment companies

One area of the share market that shouldn't be discounted for ASX passive income are listed investment companies (LICs), which enable us to invest in a company whose activity is making investments rather than selling products or services.

Part of the appeal of LICs is that they can utilise the profits of investment performance to pay a steady flow of dividends to investors.

The oldest and largest LIC – Australian Foundation Investment Co Ltd (ASX: AFI) – has been very consistent with its dividends this century.

Other LICs which appeal based on their dividend records include WAM Microcap Ltd (ASX: WMI), WCM Global Growth Ltd (ASX: WQG) and L1 Long Short Fund Ltd (ASX: LSF).

The post How to start generating ASX passive income with as little as $500 appeared first on The Motley Fool Australia.

The US share market recently hit a record high. I expect share prices to rise over time because of growing earnings, but a steadily rising price-earnings (P/E) ratio can be a valuation risk.

Additionally, the US tariff situation continues to be unpredictable and could lead to further volatility or even a market decline if it's not positively resolved, as we saw in April.

So, for concerned investors, the following two ASX ETFs could be appealing opportunities.

Vanguard FTSE Europe Shares ETF (ASX: VEQ)

For investors still wanting significant diversification, this could be a good option to consider. It provides exposure to companies listed in major European markets.

Numerous countries are represented, including the UK, France, Germany, Switzerland, the Netherlands, Sweden, Italy, Spain, Denmark, Belgium, Finland, Norway, Poland, Austria, Ireland, and Portugal.

The portfolio has a large number of holdings, with over 1,200 businesses.

Investors may recognise some of the largest positions in the portfolio, including SAP, ASML, Nestle, Roche, Novartis, Novo Nordisk, AstraZeneca, HSBC, Shell, and Siemens.

There are four different sectors with a double-digit weighting, including financials (22.4%), industrials (19.1%), healthcare (13.2%), and consumer discretionary (10.1%).

This ASX ETF has actually performed quite strongly in recent history. In the past three years, it has delivered an average return per year of 16.5%, and in the last five years, it was 13.6% per year. That demonstrates European stocks can perform well.

Betashares FTSE 100 ETF (ASX: F100)

For Aussies wanting more targeted exposure to the UK share market, the F100 ETF could be a great choice.

This fund is about giving investors exposure to the 100 largest businesses listed in London. That means exposure to names like HSBC, Shell, AstraZeneca, Unilever, Rolls Royce, Relx, British American Tobacco, BP, BAE Systems, and GSK.

While these are listed in London, I would call many of them global companies and among the world leaders in what they do.

This ASX ETF has four sectors in its portfolio with a double-digit weighting: financials (23.7%), consumer staples (18.2%), industrials (16.3%), and healthcare (10.9%).

The performance of the UK share market has also been solid. It has delivered an average return per annum of almost 15% in the last three years and 13.8% per year in the past five years.

I think this is a solid ASX ETF worthy of investor consideration.

The post Worried about US shares? I'd look at buying these two ASX ETFs appeared first on The Motley Fool Australia.

But, the businesses on the ASX only account for around 2% of the global share market. So, I think it'd be a good idea to have exposure to some of the thousands of businesses listed overseas. There are plenty of wonderful companies listed in Australia, but there are a lot of global winners listed in other locations such as the US, the UK, Europe, Japan and so on.

Rather than trying to identify those individual winners ourselves, we can utilise ASX ETFs as a way to improve our portfolio diversification and hopefully increase our portfolio's returns too. I'm not suggesting selling any VAS ETF units, but I believe it'd be a good idea to focus new investment dollars on globally diversified international share ideas.

VanEck MSCI International Quality ETF (ASX: QUAL)

The first ASX ETF I'll tell you about is the QUAL ETF – the largest ETF in my portfolio. I like it for a few different reasons.

For a company to be considered for this portfolio, it must rank well on a combined score across three attributes – a high return on equity (ROE), earnings stability and have low financial leverage.

A high return on equity means the business is generating a high level of profit for the amount of shareholder money retained within the company (this includes not only cash but also other assets).

Earnings stability suggests profit generation usually rises rather than falls each year, which is supportive for share prices (and dividend growth).

Low financial leverage means the company has low levels of debt for its size. That means smaller (or no) interest payments and the company's balance sheet is in a healthy position.

It's a portfolio of around 300 stocks, so it offers good diversification compared to the VAS ETF. The businesses come from multiple countries and sectors, so it's pleasingly diversified in a number of ways.

Over the last five years, it has delivered an average return per year of 14.6%, showing the capability of the collective group. Of course, past performance is not a guarantee of future performance.

Betashares FTSE 100 (ASX: F100)

The F100 ETF is a fund that provides exposure to the largest 100 companies (by market capitalisation) that trades on the London Stock Exchange.

The ASX and the US aren't the only places to invest in appealing blue-chip businesses. I'd describe the businesses in the F100 ETF as global businesses, they just happen to be listed in London.

We're talking about names like Astrazeneca, Shell, HSBC, Unilever, Rolls-Royce, Relx, British American Tobacco, BP, GSK and BAE Systems.

I also believe this portfolio is diversified. There are five sectors with a weighting of more than 9.5%: financials (23.7%), consumer staples (18.2%), industrials (16.3%), healthcare (10.9%) and energy (9.7%).

In the five years to May 2025, the VAS ETF has delivered an average return per year of 12%. The F100 ETF has returned an average of 13.8% per year in the five years to May 2025. Again, past performance is not a guarantee of future performance, but I think both of these ASX ETFs are compelling options for future returns and diversification.

The post Overinvested in Vanguard Australian Shares Index ETF (VAS)? Here are two alternative ASX ETFs appeared first on The Motley Fool Australia.

The reduction of Australian inflation to below 3% is a good sign for struggling households. Another interest rate cut by the RBA should help every household and business with debt.

However, the increased uncertainty with the US economy may be making some investors nervous about investing in US shares. So, I'll talk in this article about three ASX ETFs that offer different exposure than the US share market.

Vanguard Australian Shares Index ETF (ASX: VAS)

This is the most popular ASX ETF in terms of how much client money is invested in it. It provides exposure to the S&P/ASX 300 Index (ASX: XKO), which is 300 of the biggest businesses on the ASX. That's a good amount of diversification, in my view.

That includes businesses like Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), Telstra Group Ltd (ASX: TLS) and Westpac Banking Corp (ASX: WBC).

Australian businesses typically have a generous dividend payout ratio, allowing them to have a pleasing dividend yield. This supports the overall dividend yield of the VAS ETF.

At the end of March 2025, the ASX ETF had a dividend yield of 3.6% (excluding the bonus of franking credits). Considering businesses can grow their dividend payments, I think that's a good starting point.

Betashares India Quality ETF (ASX: IIND)

This fund gives Aussie investors the ability to invest in 30 of the highest-quality Indian companies based on a combined ranking of high profitability, low debt levels and high earnings stability.

The Indian economy is attractive to me because of various helpful trends such as a rising population and digitalisation.

By owning the highest-quality businesses in India, I think investors give themselves the best chance of tapping into that underlying growth.

At the end of March 2025, the IIND ETF's 12-month distribution yield was 3.4%. Considering the long-term underlying earnings growth of these Indian businesses, I think that's a good starting point.

Some of the biggest holdings in the portfolio include ICICI Bank, Infosys, Kotak Mahindra Bank and Axis Bank.   

Betashares FTSE 100 ETF (ASX: F100)

The UK share market could be a good place to invest for investors wanting exposure to global businesses but not from the US.

The FTSE 100 represents 100 of the largest businesses listed in the UK. Some of the businesses in the portfolio include Astrazeneca, Shell, HSBC and Unilever.

According to BetaShares, the F100 ETF has a 12-month distribution yield of 3%. That's a decent starting dividend yield, in my view.

Impressively, in the five years to March 2025, this fund has delivered an average return of 12.5% per year.

The post 3 compelling ASX ETFs I'd buy for diversification and income appeared first on The Motley Fool Australia.

Just a few short months ago, many investors had high hopes for US President Donald Trump's second term. With promises of less regulation and lower taxes, markets rallied for several months after his election victory. 

However, this optimism was short-lived. In February, cracks started to appear as the 47th President began to roll out his tariff plans. 

Although tariffs had been discussed at length on the campaign, many investors believed they were a negotiating tactic. When Trump unveiled widespread tariffs on 2 April, the market reacted very negatively. 

While a falling US dollar and a rise in bond yields are common in emerging markets, they are very rare in the US. In fact, this is only the fifth time in the past thirty years that it has occurred.

Many institutional investors have recently initiated the 'sell America trade', reducing their exposure to US equities. 

In March, the Australian Financial Review reported that the biggest Australian superannuation funds had been repositioning their portfolios towards international shares. Super funds currently invest around $630 billion in US assets. 

Europe has gained traction as a viable alternative, with many institutional investors increasing their exposure.

Investors who own a US-focused exchange-traded fund (ETF) such as the Vanguard US Total Market Shares Index AUD ETF (ASX: VTS) have several options to mimic this position. Specifically, they could sell part or all of their US-focused ETFs and invest in the following alternative options.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

Investors looking to reduce US exposure could invest in the Vanguard MSCI Index International Shares ETF. For a management expense of 0.18%, investors gain diversified exposure to 1,304 companies. This ETF is somewhat diversified away from the US, with 5.5% invested in Japan, 3.8% in the United Kingdom, 3.2% in Canada, 2.9% in France, and 2.5% in Germany. Its five-year track record is also strong, having risen 72% over that time.

Vanguard FTSE Europe Shares ETF (ASX: VEQ)

Those even more pessimistic on US equities may wish to diversify away from them entirely. Vanguard FTSE Europe Shares ETF provides low-cost exposure to companies listed in major European markets. It is also very diversified, with 1,247 holdings. However, its management fee is slightly higher at 0.35%. Its long-term track record is also inferior to VGS', having climbed 60% over the past five years.

Betashares FTSE 100 ETF (ASX: F100)

Finally, those particularly bullish on the United Kingdom may be more enticed by the Betashares FTSE 100 ETF. This ETF provides exposure to the largest 100 companies listed on the London Stock Exchange. Its management fee is the highest of the three ETFs, at 0.45%. Its 5-year performance is also the weakest, having increased by 56%.

Foolish Takeaway

ASX ETF investors looking to get on the 'sell America' bandwagon have several options. VGS, VEQ, and F100 have exposure to European markets of varying degrees. Each ETF has delivered strong results over the past five years, making them all solid choices based on their track record.

The post How to play the 'sell America' trade with ASX ETFs appeared first on The Motley Fool Australia.

When investors buy iShares S&P 500 ETF (ASX: IVV) or Vanguard US Total Market Shares Index ETF (ASX: VTS), they're buying a number of great businesses, including the big US tech companies. I think those funds are good investments. However, I wouldn't suggest investors have all their portfolio invested in one of those funds.

The recent uncertainty arising from the US shows the value of having diversification. The global share market is more than just the US stocks.

For investors wanting to add geographic exposure to their portfolios, the following three funds below could be compelling ideas.

Vanguard All-World ex-US Shares Index ETF (ASX: VEU)

The first is Vanguard All-World ex-US Shares Index ETF. This ETF is one of the easiest ways to get exposure to the global share market outside of US stocks.

It's invested in businesses from across the world, including places like Japan, the UK, China, Canada, France, Switzerland, Germany, India, Taiwan, Australia, the Netherlands, South Korea, Sweden, Italy, Spain, Denmark, Hong Kong, Saudi Arabia and Brazil.

The VEU ETF is very diversified, with more than 3,800 holdings. In my view, it adds a lot of what investors may be looking for with diversification away from US-focused ETFs.

It has an annual management fee of just 0.04%, so it's very low cost.

Betashares FTSE 100 ETF (ASX: F100)

For investors who want a more specific geographic allocation, I think this is one of the more appealing ones to consider.

The F100 ETF is invested in 100 of the biggest businesses listed in London, plenty of them have global earnings – this fund is not a pure bet on the UK economy. I believe 100 holdings is a solid amount of diversification.

Trump hit Europe with a higher tariff rate (20%) than the UK (10%). This may suggest that UK companies could be better placed to continue generating solid earnings in the coming years under the Trump administration.

Betashares India Quality ETF (ASX: IIND)

I don't know how the global share market or global manufacturing base will adjust in the foreseeable future, but I think India's economy is well-placed to continue growing regardless of what happens.

The IIND ETF invests in 30 of the highest-quality Indian companies based on their combined ranking across high profitability, low leverage and high earnings stability.

BetaShares says India's economy is one of the fastest-growing in the world, with future growth potential underpinned by "strong structural fundamentals". It's benefiting from tailwinds like a rising population, digitalisation of its economy and a growing middle class.

I think this could be an interesting ASX ETF to own in the coming years.

The post Overinvested in US ETFs? Here are three alternative ASX ETFs appeared first on The Motley Fool Australia.

President Trump has indicated that he's going to reveal a tariff plan to include all countries. According to reporting by CNBC, Trump said at the weekend:

            You'd start with all countries. So let's see what happens. There are many countries.

Investment bank Goldman Sachs reportedly warned in a client note at the weekend that tariffs could increase inflation and significantly slow economic growth in the US.

While that could lead to a knock-on effect on other countries, I believe the impact could have a smaller effect on other countries.

If Aussie investors' international exposure is largely to US shares, it could be an idea to think about other investments that give geographic diversification. That's why I like the following ASX ETFs as ideas for diversification.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

If an Aussie investor has no international share exposure at all, the VGS ETF could be a smart choice because it gives exposure to both US shares (which are cheaper after the recent decline) and other global shares.

It's invested in more than 1,300 businesses. It gives significant exposure to the US tech juggernauts and the US stock market in general, but the following countries have a weighting of more than 0.1%: Japan (5.3%), the UK (3.7%), Canada (3.1%), France (2.8%), Switzerland (2.4%), Germany (2.4%), the Netherlands (1.1%), Sweden (0.9%), Spain (0.7%), Italy (0.7%), Denmark (0.7%), Hong Kong (0.5%), Singapore (0.4%), Finland (0.2%), Israel (0.2%) and Belgium (0.2%).

Whatever happens this week after Trump's Liberation Day, the VGS ETF can give a fairly close representation of the global stock market when it comes to major developed countries.

Betashares FTSE 100 ETF (ASX: F100)

UK shares went through a difficult time following the Brexit vote and then COVID-19. But, the UK stock market seems to have gained confidence and investors are more optimistic about the businesses listed in London.

In the last 12 months alone, the F100 ETF unit price has risen more than 15%. It invests in 100 of the largest businesses listed on the London Stock Exchange such as Shell, Astrazeneca, HSBC, Unilever, BP and Rolls-Royce.

While these companies are listed in London, they are global businesses with quality earnings. This ASX ETF's holdings could see less disruption from Trump's tariff Liberation Day.

Betashares Asia Technology Tigers ETF (ASX: ASIA)

The US isn't the only place with large technology companies. There are also a few giants in Asia as well – this fund aims to give exposure to 50 large tech and online retail stocks in Asia outside of Japan.

Looking at the largest holdings, the ASIA ETF is invested in companies like Alibaba, Tencent, Taiwan Semiconductor Manufacturing, Samsung Electronics and Xiaomi.

Technology is becoming increasingly important in the world, so these companies in the ASIA ETF could be a good way to profit from the changes happening in Asia.

Overall, I think all three of these ASX ETFs are good opportunities for diversification and long-term returns.

The post Achieve geographical diversification with these ASX ETFs before Trump's Liberation Day appeared first on The Motley Fool Australia.

The VTS ETF listed on the ASX in May 2009, and between then and February 2025, it returned an average of 16% per year, which is great. However, it's also worth noting that the ETF unit price has dropped close to 10% since 31 January 2025.

The fund's pure exposure to the US share market has been very beneficial over the long term, but the worries about tariffs and the US economy are painful in the short term.

For investors who don't want their portfolio as exposed to the US share market, it could be a good idea to look at ETFs that give different geographic exposure.  

Betashares FTSE 100 ETF (ASX: F100)

This fund gives investors exposure to the UK share market. Many of these businesses just happen to be listed in London, but they can earn profit from across the world.

Some of the biggest companies in this portfolio include AstraZeneca, Shell, HSBC, Unilever, BP, Rolls Royce, GSK, London Stock Exchange, BAE Systems, Diageo, and Barclays.

Impressively, the fund's unit price has risen since the end of January 2025, despite the volatility of the global share market, as the chart shows.

In the three years to February 2025, the F100 ETF has delivered a net return of 12.6%. That's stronger than the S&P/ASX 300 Index (ASX: XKO) return of an average of 8.9% per year over the same time period. Of course, past outperformance is not a guarantee of future outperformance.

I also like that this fund has a double-digit weighting to five sectors, which is good diversification in my eyes. Those five industries are: financials (23.6%), consumer staples (17%), industrials (15.2%), healthcare (12.1%), and energy (11%).

Betashares Japan Currency Hedged ETF (ASX: HJPN)

The Japan share market has livened up in recent times after changes were made to encourage Japanese businesses to invest and grow.

This fund owns approximately 140 businesses, and its Yen exposure is currency hedged, which aims to reduce the effect of currency fluctuations on portfolio performance.

Some of the biggest positions in this portfolio include Toyota Motor, Mitsubishi UFJ Financial, Sony, Hitachi, Keyence, Nintendo, and Canon.

In the three years to February 2025, this ASX ETF has delivered an average annual return of 16.5%. Again, past performance is not a reliable indicator of future returns, but it shows that Japanese stocks can deliver good returns.

I think this could also be a solid option for diversification to add to US and Australian exposure. There are four sectors that have a double-digit weighting in the HJPN ETF: consumer discretionary (23.8%), industrials (23%), IT (15.8%), and financials (14%).

The post Overinvested in the Vanguard US Total Market Shares Index ETF (VTS)? Here are two ideas for diversification appeared first on The Motley Fool Australia.

But let's talk about some ASX exchange-traded funds (ETFs) that can say the same.

Alongside ASX 200 shares, there has been a huge swath of ETFs that have seen new 52-week highs this Thursday. We won't go over them all, but here are 12 of the most prominent funds to hit new high watermarks:

12 ASX ETFs at new 52-week highs today

Here are the 12 ETFs that have just clocked new 52-week highs this Thursday:

*at the time of writing

Why are these funds at new highs today?

As you can see above, we have a very healthy mix to discuss. Typically, when we see a bunch of ETFs hit new highs, they are correlated to a particular asset class or market.

When the US markets reach new records, for example, the funds that hold mostly or solely American stocks usually follow suit.

But today, it's different.

We have your standard ASX index funds like IOZ and ILC at new highs.

But we also have some thematic, global funds – HACK, ASIA, ROYL and GXAI – there too.

We have some index funds, too. IEU and F100 both track international markets, the United Kingdom and Europe, to be specific. It is interesting to note that the European markets are hitting new highs at the same time that the UK-based F100 is.

Here on the ASX, it's no surprise to see IOZ and ILC at new heights, given the new record that the ASX 200 Index hit this morning. That was helped enormously by Commonwealth Bank of Australia (ASX: CBA)'s new record high itself, alongside multi-year highs for Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB).

So a great day for ETF owners. Let's see what tomorrow brings.

The post 12 ASX ETFs at new 52-week highs this Thursday appeared first on The Motley Fool Australia.

Most investors have probably heard of the Vanguard Australian Shares Index ETF (ASX: VAS) and the Vanguard Australian Shares High Yield ETF (ASX: VHY). They own plenty of ASX blue-chip shares in their holdings. They certainly do offer a good dividend yield, but they're largely focused on ASX bank shares and ASX mining shares.

I think if investors are requiring passive income, it could be a good idea to get more diversification, which could help protect against any particular risks for a specific sector. That's why I like the look of the below two ASX ETFs.

SPDR S&P Global Dividend ETF (ASX: WDIV)

For investors concerned about possible dividend cuts, this fund could be an effective option.

The WDIV ETF aims to own approximately 100 relatively high dividend-yielding companies that have increased or maintained their payouts for at least 10 consecutive years.

The number of stocks from each country is capped at 20, while the weighting for each individual stock is capped at 3%. A maximum of 25% is allowed for each sector (at the rebalancing date).

It has an annual management cost of 0.35%, which I think is reasonable for how much work has gone into constructing this portfolio.

Currently, the fund has double-digit exposure to four sectors: financials (25.4%), utilities (16.8%), real estate (14.3%), and industrials (10.2%).

According to the ETF's provider, the dividend yield for the WDIV ETF is currently 5.6%, which I'd describe as impressive for a high-yield passive income option.  

Betashares FTSE 100 ETF (ASX: F100)

This ASX ETF gives investors exposure to 100 of the biggest companies on the UK stock market.

UK shares typically trade at a fairly attractive price-earnings (P/E) ratio, which enables a reasonably high dividend yield.

According to Betashares, as of 31 December 2024, the F100 ETF had a distribution yield of 3.4%. I think that's appealing compared to most other internationally focused ASX ETFs (which aren't specifically created to hunt for dividends).

Investors may recognise some of the biggest positions in the portfolio, including AstraZeneca, Shell, HSBC, and Unilever. These are strong, global businesses that just happen to be listed in London.

Pleasingly, in the past three years to 31 January 2025, this ASX ETF has returned an average of 10.3% per annum. Within that, it has provided a decent level of dividends, so I think it's a solid high-yield passive income option.

The post Here are my 2 favourite ASX ETFs to buy for high-yield passive income in 2025 appeared first on The Motley Fool Australia.

The Australian share market only accounts for approximately 2% of the global share market. If Aussies have more than 2% of their portfolio invested in ASX shares, then they have a bigger allocation than what the global share market would suggest.

I'm not going to suggest that investors need to go out and gain exposure to every country that has a stock market. It's not necessary to invest for an allocation to 'emerging markets'.

But, I do believe that it's a good idea to invest in businesses that are among the best in the world at what they do. That's why I think it's a good idea to consider international share ASX-listed ETFs like the two below.

Betashares Nasdaq 100 ETF (ASX: NDQ)

Some of the best businesses that Aussies may be missing out on are the giant US tech companies. Virtually all of them seem to be listed on the NASDAQ, a North American stock exchange.

The NDQ ETF allows investors to invest in 100 of the largest non-financial businesses on the NASDAQ ETF.

The biggest positions in this fund include Apple, Nvidia, Microsoft, Amazon, Broadcom, Tesla, Meta Platforms, Alphabet, and Costco.

These businesses have been driving many of the technological changes in the last twenty or so years, including smartphones, cloud computing, AI, gaming, online gaming, e-commerce, social media, online video, electric vehicles, and more – at least one of the major US companies above was involved in each of those themes I mentioned.

I think trends like AI, e-commerce, and cloud computing can help drive the earnings of the NDQ ETF for many years into the future, making it an attractive option for investors who want diversification in addition to their Australian shares.

Impressively, the NDQ ETF has returned an average of just over 20% per year since it started in May 2015. I'm not expecting the next decade to be as good as that, but I believe its long-term returns can outperform the S&P/ASX 200 Index (ASX: XJO).

Betashares FTSE 100 ETF (ASX: F100)

I'd understand if some investors were cautious about investing in the US share market right now, even just because of the elevated valuation it's currently trading at.

One place to consider investing instead could be the UK share market, which has several appealing businesses. The Australian share market is dominated by a few banks and miners, so why not consider another share market with similar values to Australia but different companies in different sectors?

Five industries within the F100 ETF have a weighting of more than 10%: energy, healthcare, industrials, consumer staples, and financials. That's a pleasing level of diversification, in my opinion.

You may recognise some of the businesses in this fund's top 10 holdings, which total 100 positions. Those top ten company exposures are AstraZeneca, Shell, HSBC, Unilever, RELX, BP, British American Tobacco, Diageo, London Stock Exchange Group, and GSK.

It has been a somewhat difficult period for the UK share market in the past decade, but it has outperformed the ASX share market in the last three years, so it could be unlocking a period of stronger returns in the 2020s.

The post Overinvested in Australian shares? Try these 2 ASX ETFs appeared first on The Motley Fool Australia.

Some of the ASX's biggest companies are known as ASX dividend shares, including BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), and ANZ Group Holdings Ltd (ASX: ANZ).

However, a strong rally of ASX bank shares in 2024 has lowered the overall dividend yield. At the end of November 2024, the dividend yield of the Vanguard Australian Shares Index ETF (ASX: VAS) — a fund that tracks the S&P/ASX 300 Index (ASX: XKO) — was 3.4%.

There are other share markets out there that can also be good income options. Let's look at two geographic-based ASX ETFs that offer comparable and pleasing dividend income.

Betashares FTSE 100 ETF (ASX: F100)

The purpose of this ASX ETF is to provide exposure to a portfolio of 100 blue-chip companies on the London Stock Exchange.

I'd describe a good number of these businesses as global companies, such as Astrazeneca, Shell, HSBC, Unilever, Relx, BP, British American Tobacco and Diageo. While they are listed in London, they generate earnings from across the world.

One of the interesting things about the F100 ETF is that it trades on a pleasingly low price/earnings (P/E) ratio, enabling a good dividend yield. According to BetaShares, the F100 ETF had a forward P/E ratio of 11.5x at the end of November 2024, compared to 21.8x for the VAS ETF.

According to BetaShares, the 12-month distribution yield from the F100 ETF was 3.5% at the end of November 2024.

Betashares India Quality ETF (ASX: IIND)

I believe getting exposure to the Indian economy could be a smart move for the foreseeable future.

The Australian Treasury projects that the Indian economy will see an average annual growth rate of 6% over the next two decades thanks to improving productivity.

Not every Indian business is going to be high-quality, just like on the ASX or any other share market. So, this fund is focused on owning just the high-quality Indian companies.  

Companies must rank well on three factors to make it into the portfolio: high profitability, low leverage, and high earnings stability. When you put those factors together, it's not surprising to me that the IIND ETF has returned an average of 10.1% per year since August 2019 – a solid return.

According to BetaShares, this fund's forward P/E ratio was 24x as of 29 November 2024, reflecting the expected growth potential of holdings like Infosys, Tata Consultancy Services, and Hindustan Unilever.

Despite the higher earnings valuation, this ASX ETF still offered a 12-month distribution yield of 3.4% at 29 November 2024.

The post I'd buy these 2 ASX ETFs for income and diversification in 2025 appeared first on The Motley Fool Australia.

However, one of the prime reasons investors arguably choose to add ASX ETFs to their share portfolios is because of the diversification they can provide.

ETFs can represent an investment in hundreds, or even thousands, of underlying shares, all in one easy ticker code. As such, it only takes one trade to add a significant level of diversification to even the most concentrated of ASX stock portfolios.

Now, here on the ASX, most investors use ASX index funds for these purposes, sometimes adding American-focused funds like the iShares S&P 500 ETF (ASX: IVV) for an extra diversification boost.

However, ASX ETFs allow us to go much further than the local or American market. So today, let's discuss three exotic ETFs that can inject diversity into any portfolio.

3 exotic ASX ETFs that will diversify any stock portfolio

iShares MSCI South Korea ETF (ASX: IKO)

First up, let's check out this ETF from iShares. The iShares MSCI South Korea ETF represents an investment in the largest 100 or so companies in South Korea.

The South Korean share market is dominated by tech companies, industrial stocks, and financials, which is slightly different from our own ASX.

Among this ETF's top holdings, you'll find familiar names like Samsung, Hyundai, Kia Motors, and LG. All of these companies are globally dominant and provide access to industries that do not have a big presence on the ASX.

If you're looking to add some exotic spice to your ASX stock portfolio, this ETF is a great place to start.

BetaShares FTSE 100 ETF (ASX: F100)

Although the United Kingdom is one of the largest economies in the world, we don't see much investment in British shares on the ASX. You can change that with this fund from Betashares, though. The Betashares FTSE 100 ETF represents an investment in the largest 100 stocks listed on the London Stock Exchange.

I like the London Stock Exchange for ASX investors because its largest holdings tend to be in industries that aren't heavily represented on the ASX. Some of F100's top stocks include pharma giant AstraZeneca, oil titan Shell, consumer staples company Unilever, and tobacco stock British American Tobacco.

This can add a lot of diversification to an ASX-dominated portfolio.

iShares MSCI Japan ETF (ASX: IJP)

Next up, we have another fund from iShares. The iShares MSCI Japan ETF does pretty much what it says on the tin. It allows access to the largest 200 shares listed on the Tokyo Stock Exchange.

Japanese stocks are not easily accessible on the ASX. Yet some of the world's most dominant companies are listed here, including Toyota, Sony, Mitsubishi, SoftBank and Nintendo.

Again, this focus on industrial and manufacturing companies provides some nice balance against the miners and banks that dominate the ASX.

The post 3 exotic ETFs to diversify any ASX stock portoflio appeared first on The Motley Fool Australia.

Businesses trading at a low price-earnings (P/E) ratio or ones priced at a big discount to their underlying asset value could be underrated opportunities in this market.

Growing businesses like Pro Medicus Ltd (ASX: PME) and Commonwealth Bank of Australia (ASX: CBA) are trading at much higher earnings multiples than they have for most of their history. They could keep rising and outperforming the ASX stock market in the short term, but it becomes less likely the higher they go, in my opinion.

With that in mind, I think it would be a good idea to consider the two stocks below, which look cheap to me.

Betashares FTSE 100 ETF (ASX: F100)

This is an exchange-traded fund (ETF) that tracks 100 of the largest businesses on the London Stock Exchange. It's a cheap ASX share in my mind because it trades on the ASX.

This portfolio includes several global leaders, such as Shell, Astrazeneca, HSBC, BP, London Stock Exchange, GSK, Rio Tinto Plc, Diageo (Jonnie Walker, Guinness, Smirnoff), Rolls Royce, BAE Systems, and Barclays.

While the UK economy has its challenges, I think it will be able to grow in the longer term, and plenty of the businesses within the F100 ETF are not dependent on the UK.

The F100 ETF looks cheaper to me than the ASX share market, which I'll measure with the BetaShares Australia 200 ETF (ASX: A200).

According to BetaShares, the A200 has a forward P/E ratio (or earnings multiple) of 18, while the F100 ETF has a forward P/E ratio of 11.4.

While a cheaper P/E ratio doesn't guarantee better returns, the F100 ETF, with its cheaper price and portfolio of quality businesses, is more likely to deliver better returns than the overall ASX share market over the next five years.

Centuria Industrial REIT (ASX: CIP)

This is an industrial property-focused real estate investment trust (REIT) that I think is being undervalued significantly.

Firstly, there's the obvious discount to the net tangible assets (NTA) of $3.87 at June 2024, which tells investors the net value of the cheap ASX share's assets and liabilities (including independent property valuations). The current share price to NTA discount is 23%.

I think the current period of high interest rates has opened up a good buying opportunity.

This business is benefiting from a high level of demand for industrial space for distribution and logistics properties due to the growth of e-commerce activity, the onshoring of supply chains after COVID impacts, and Australia's rising population.

As rental contracts expire, they are being replaced by leases with significantly higher rental rates to reflect the market growth since the last contract. In the first quarter of FY25, it delivered a positive re-leasing spread of 54% – that's a huge jump in rental income and bodes well for future rental profits and distributions, particularly once interest rates start coming down.

It's expecting to pay a distribution that equates to a yield of 5.4%.

The post I think these 2 cheap ASX shares are buys for value investors appeared first on The Motley Fool Australia.

The dividend yields of ETFs are primarily decided by the dividend yields of their underlying holdings.

So, it's not surprising that options like the Vanguard MSCI Index International Shares ETF (ASX: VGS) and iShares S&P 500 ETF (ASX: IVV) have low dividend yields because their biggest holdings, such as Microsoft, Nvidia, Meta Platforms, Alphabet, and Apple, also have low dividend yields.

But what's an investor supposed to do if they want passive income but also want diversification beyond what the Vanguard Australian Shares Index ETF (ASX: VAS) can offer? The ASX share market is weighted towards banks and miners, with those two sectors making up more than half of the S&P/ASX 200 Index (ASX: XJO).

Another high-yield ASX dividend ETF option

I think the Betashares FTSE 100 ETF (ASX: F100) is a compelling option to consider for passive income.

It provides exposure to 100 blue-chip companies that are listed on the London Stock Exchange.

The F100 ETF owns a number of intriguing companies, in my opinion. These include Shell, AstraZeneca, HSBC, Unilever, Relx, BP, GSK, British American Tobacco, the London Stock Exchange, Rio Tinto, Diageo, Glencore, National Grid, Rolls Roye, BAE Systems, Barclays and Reckitt Benckiser.

The portfolio is nicely diversified with five sectors — financials, consumer staples, industrials, healthcare and energy — given a weighting of more than 10%.

Many of these businesses have a decent dividend yield, so collectively, the fund can be considered a high-yield ASX dividend ETF. According to BetaShares, at the end of September 2024, the F100 ETF had a dividend yield of 3.6%. That compares to 1.7% for the VGS ETF.

Not only is the F100's dividend yield appealing, but it has also been outperforming the VAS ETF's overall returns.

According to BetaShares, the F100 returned an average of 9.9% over the three years to September 2024. The VAS ETF has only returned an average of 8.1% per annum over the last three years.

With a forward price/earnings (P/E) ratio of just 11.7x as of 30 September 2024, the F100 ETF still looks appealingly valued to me, particularly given the trending downwards of interest rates in the United Kingdom and internationally.

Of course, investors can bolster their passive income yield by owning individual ASX dividend shares as well.

The post One high-yield ASX dividend ETF to buy to generate passive income appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) has gained an impressive 6.5% in the three months since June, notching up several new record highs in the process. It's also gained a whopping 17% over the past year.

Nevertheless, our Foolish writers reckon there is still plenty of value to be had on the Aussie bourse — if you know where to look.

On that note, here are the ASX shares they think should be firmly on your buy list for October:

6 top ASX shares for October 2024 (smallest to largest)

• Betashares FTSE 100 ETF (ASX: F100), $325 million
• Megaport Ltd (ASX: MP1), $1.17 billion
• Tuas Ltd (ASX: TUA), $2.52 billion
• NIB Holdings Limited (ASX: NHF), $2.88 billion
• Zip Co Ltd (ASX: ZIP), $3.59 billion
• Life360 Inc (ASX: 360), $4.22 billion

(Market capitalisations as of market close 30 September 2024)

Why our Fool writers love these ASX stocks

Betashares FTSE 100 ETF

What it does: The BetaShares FTSE 100 ETF is an ASX exchange-traded fund (ETF) that tracks the largest 100 stocks on the United Kingdom's London Stock Exchange.

By Sebastian Bowen: With ASX 200 stocks still trading very close to all-time highs, my gaze has moved offshore this October. The ASX is full of high-quality companies.

But most of my favourites are looking a tad expensive at the moment. Plus, I already hold an ASX index fund that I'm not too excited about topping up on right now. That's why this British index fund appeals to me.

The London Stock Exchange is quite different to the ASX in nature. It still has a meaningful exposure to financial shares. But it is low on miners and high on consumer staples stocks, healthcare shares and industrial companies — all areas that are underrepresented on the ASX 200.

Some of this ETF's top holdings include global giants like Shell, AstraZeneca, Unilever, BP and British American Tobacco.

F100 units have returned a decent average of 10.16% per annum over the past three years (as of 30 August). That includes an attractive dividend component as well.

This ETF would be a handy addition to any ASX portfolio this October for some healthy geographic, economic, and currency diversification.

Motley Fool contributor Sebastian Bowen owns shares of Unilever and British American Tobacco.

Megaport Ltd

What it does: Megaport is a leading provider of network-as-a-service (NaaS) solutions. Its global Software Defined Network (SDN) helps businesses rapidly connect their networks to services via an easy-to-use portal or open API.

By James Mickleboro: I think Megaport is one of the best ways to gain exposure to artificial intelligence (AI) on the Australian share market. And with its shares hitting 52-week lows last week, now could be an opportune time to make a long-term investment.

As the world's largest NaaS operator, Megaport is benefitting from an increasingly complex cloud environment and connectivity demands. In addition, the company recently revealed it was seeing a significant uptick in GPU-as-a-service (GPUaaS) operators coming to market and driving demand for high levels of capacity and services within existing data centres.

GPUaaSs offer a way to access high-performance computing resources for machine learning, deep learning, and other data.

I believe this leaves Megaport well-positioned to continue its strong growth long into the future.

Last month, Goldman Sachs put a buy rating and a $12.00 price target on Megaport shares.

Motley Fool contributor James Mickleboro owns shares of Megaport Ltd.

Tuas Ltd

What it does: Tuas is a telecommunications company in Singapore that offers mobile and broadband services. As of 31 July 2024, it had more than 1 million active mobile services.

By Tristan Harrison: This ASX 300 telco recently released its FY24 result and delivered on all the elements that had attracted me to make an investment before its earnings report.

Its active mobile services increased 28.6% year over year to 1.05 million, which helped revenue grow by 36% to $117 million. Mobile average revenue per user (ARPU) increased from $9.37 to $9.68, and Tuas had more than 4,000 broadband subscribers at the end of FY24.

The company also delivered impressive operating leverage, with profit growing much faster than revenue. Compared to FY23, Tuas saw its operating profit (EBITDA) rise by 60%, and the EBITDA margin improved from 36% to 42%.

Tuas' net loss after tax improved by $10.9 million to a net loss of $4.4 million. The business aims to achieve a positive full-year net profit after tax in FY25.

Also in FY25, the company will focus on growing its 5G and fibre broadband services and the continued introduction of "attractive value plans to grow subscribers."

Tuas expects to spend between $45 million and $55 million on capital expenditures in FY25 to support subscriber growth and expand 5G coverage.

I'm excited by how much this company could grow over the next few years, and expect the revenue and profit margins to keep increasing. 

Motley Fool contributor Tristan Harrison owns shares of Tuas Ltd.

NIB Holdings Limited

What it does: If you have private health insurance, there's a relatively good chance it's with either Medibank Private Ltd (ASX: MPL) or NIB Holdings. The latter provides health insurance to more than 710,000 Australian residents, 164,000 New Zealanders, travellers, and international students. 

By Mitchell Lawler: NIB shares have been badly bruised since the release of the company's FY24 full-year results. On 26 August, investors slammed the health insurer for a result that failed to meet expectations. 

NIB is also facing a healthy dose of scepticism as private hospitals begin putting pressure on the insurance sector to cough up more cash. Still, does it warrant a 20% fall from its post-earnings price? 

I'm convinced the market has overreacted. Just look at the company's track record of growth over the last decade — exceptional! And, given the expected influx of migration to Australia, I'm expecting the trend to continue for NIB.

Motley Fool contributor Mitchell Lawler does not own shares of NIB Holdings Limited.

Zip Co Ltd

What it does: Zip is a digital financial services company best known for its buy now, pay later (BNPL) offerings. Zip's two core markets are Australia and New Zealand (ANZ), as well as the United States. Zip offers access to point-of-sale credit and digital payment services. 

By Bernd Struben: The past 12 months have seen the Zip share price soar an eye-watering 882%. The huge gains came after management adopted a sustainable growth model and implemented significant cost-cutting measures.

The results were on clear display when the company reported its FY 2024 results.

Highlights included a 28.2% year-on-year increase in revenue to $868 million. On the bottom line, Zip achieved a cash gross profit of $373 million, up 52.8% from FY 2023. And FY 2025 kicked off with Zip's successful $267 million capital raise, which management used to pay off the company's corporate debts.

While I don't expect Zip shares to gain another 882% in the year ahead, I do believe the ASX BNPL stock can continue to outperform.

Zip Americas delivered record cash earnings (before tax, depreciation and amortisation) of $77.2 million in FY 2024. And with the US Fed now on an interest rate-cutting path, I think Zip should be able to grow its relatively small share of the US BNPL market while continuing to boost its profitability and footprint in ANZ.

Motley Fool contributor Bernd Struben does not own shares of Zip Co Ltd.

Life360 Inc

What it does: Life360 is a software company based in the US. It is known for its flagship product of the same name — an app that allows users to easily keep track of their loved ones, pets, and belongings. Life360 has proven especially popular among parents and carers, with more than 50 million people globally using the app each month.

By Zach Bristow: Life360 shares hit 52-week highs towards the end of August before selling off sharply into September. The downturn was short-lived, however, as investors aggressively bought the dip.

While shares have mostly recovered from the sell-off, I still view now as an excellent opportunity to own a high-quality business with a hard-to-replicate advantage. Given the current geopolitical climate, including increasing concerns over safety and cybersecurity, I also believe the company is benefitting from several macroeconomic tailwinds.

Bell Potter rates Life360 stock as a buy with a $20.50 price target. Along with Goldman Sachs, the broker sees Life360 as well positioned to continue its growth pattern, especially with management targeting 25% pre-tax margins going forward.

Motley Fool contributor Zach Bristow does not own shares of Life360 Inc.

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

ETFs pass through the dividends they receive from the fund's investments onto the ETF's investors. So, if the fund's underlying holdings have sizeable dividend yields, then it's likely the ETF will have a rewarding dividend yield as well.

The VAS ETF owns a large number of ASX shares that pay high dividend yields, including Rio Tinto Ltd (ASX: RIO), National Australia Bank Ltd (ASX: NAB) and Telstra Group Ltd (ASX: TLS). That's why, according to Vanguard, the VAS ETF had a dividend yield of 3.5% at the end of July 2024. For an ETF, that's a relatively high dividend yield.

However, I prefer a few other ASX ETFs even more for income than the VAS ETF for a few different reasons. There's one ETF in particular I want to tell you about today, called Betashares FTSE 100 (ASX: F100).

More diversification

When I look at the VAS ETF holdings, around half of the portfolio is invested in just two sectors: ASX bank shares and ASX mining shares. Add in healthcare shares and that accounts for around 60% of the fund's portfolio from just three sectors.

The F100 ETF is invested in 100 of the largest businesses on the UK share market. Five sectors have double-digit weightings in the F100, including financials (19.7% of the portfolio), consumer staples (17%), industrials (14.2%), healthcare (12.8%), and energy (12.7%).

The F100 ETF's top holdings list is not dominated by banks like the ASX is. Currently, the biggest ten positions are: AstraZeneca, Shell, HSBC, Unilever, BP, GSK, Relx, British American Tobacco, Diageo, and London Stock Exchange Group.

Stronger returns

In my opinion, the larger UK companies generally offer more global earnings growth potential than the ASX's largest businesses. When companies are growing earnings and regularly investing for more growth, the market can send the share prices of those businesses up over time.

I think the dynamic I just described above is playing out, with the F100 ETF portfolio generating stronger returns than the VAS ETF.

The F100 ETF has returned an average return of 10.2% and 7.9% per annum over the past three and five years, respectively. That compares to average returns for the VAS ETF of 7.1% per annum in the last three years and 7.5% per annum in the past five years.

Solid dividend income

The F100 ETF distribution per unit has also been steadily growing over the last few years. The fund pays a distribution every six months, and I'm going to outline the progress of the distribution paid in July.

In July 2020, the distribution was 12.4 cents per unit.

In July 2021, the distribution grew to 14.6 cents per unit.

In July 2022, the distribution increased to 16.5 cents per unit.

In July 2023, the distribution rose again to 17.5 cents per unit.

In July 2024, the distribution grew to 23.8 cents per unit.

There's no guarantee that the distribution will increase by another 92% over the next four years or achieve even half as much growth. But I think it has demonstrated that the underlying businesses are providing dividend growth.

According to BetaShares, the trailing distribution yield of the F100 ETF is currently 3.5%, which I'd call a solid starting point and similar to the VAS ETF.

The post Why I'd buy this ASX ETF for income over the Vanguard Australian Shares Index ETF (VAS) appeared first on The Motley Fool Australia.

Some of the most popular ETFs aren't known for their passive income because their underlying holdings don't pay much income either. ETFs act as conduits for the dividends they receive and pass them onto investors.

The two ETFs I'm going to talk about have the potential to pay solid starting yields and can also deliver capital growth because of the growing earnings of the underlying businesses.

Magellan Global Fund – Open Class Units (ASX: MGOC)

This is one of the largest ETFs on the ASX and is managed by the listed fund manager Magellan Financial Group Ltd (ASX: MFG).

There are a few different objectives for this ETF.

It's trying to deliver "attractive risk-adjusted returns over the medium-to-long-term, while reducing the risk of permanent capital loss."

It aims to deliver net returns of 9% per annum, net of fees, over the economic cycle. Magellan also wants investors to receive a target distribution of 4% per annum.

One of the advantages of this ASX ETF is that it invests in many of the world's best businesses and has a sizeable allocation to them.

Currently, it has a weighting of at least 4% in the following businesses: Microsoft (7.2% allocation), Amazon (7.1%), SAP (5.1%), Intercontinental Exchange (4.7%), ASML (4.5%), UnitedHealth (4.4%), Apple (4.3%), Meta Platforms (4.1%), Intuit (4%) and Netflix (4%).

I like that the fund can provide exposure to all of those great stocks while aiming for a solid yield. The MGOC ETF targets a distribution yield of 4%. Due to the fund's recent capital growth, the last two payments equate to a 3.3% distribution yield.  

Betashares FTSE 100 ETF (ASX: F100)

The global share market seems to have fallen out of love with UK stocks, which has meant plenty of quality businesses are now trading at low price-earnings (P/E) ratios.

The lower the P/E ratio, the higher the dividend yield. This helps the overall dividend yield of the UK share market, which we can access via the F100 ETF.

Many of the portfolio's biggest positions are known for their dividends. Currently, the top ten positions are Astrazeneca, Shell, HSBC, Unilever, BP, Relx, GSK, British American Tobacco, Diageo, and Rio Tinto.

In the last three years, the F100 ETF has returned an average of 11%, outperforming the S&P/ASX 200 Index (ASX: XJO).

As of 31 July 2024, the ASX ETF had a 12-month distribution yield of 3.5%. Pleasingly, the annual distribution has grown each year since 2020, though that's not guaranteed to continue.

The post 2 ASX ETFs I'd buy for dividend income appeared first on The Motley Fool Australia.