There are not many businesses that I'm confidently expecting to deliver rising dividends in the coming results. A weaker economic environment could lead to some businesses deciding to maintain (or even cut) their payouts.

However, the below three names are ones I'm feeling confident about for dividend growth in the foreseeable future.

Telstra Group Ltd (ASX: TLS)

Telstra is one the ASX blue-chip shares I'm most optimistic will deliver dividend growth because of the nature of the service of what it provides. Many households, businesses and organisations seem to put an important value on having a mobile connection. I think that means the business has defensive earnings.

Telecommunications is important for numerous reasons these days such as work, education, entertainment, communication, shopping and so on.

Telstra has been steadily increasing its dividend payout in the last few years, including the FY26 half-year result. That report saw earnings per share (EPS) rise by 11.2% and the dividend per share was hiked by 10.5% to 10.5 cents.

I think it's very likely that the business will want to pay another 10.5 cents per share with its FY26 annual report.

With Australia's growing population and the prevalence of digitalisation, I think Telstra's mobile subscriber base and average revenue per user (ARPU) are set to continue rising in the coming years, which will be a useful tailwind for earnings and the dividend.

PM Capital Global Opportunities Fund Ltd (ASX: PGF)

This is a listed investment company (LIC), which means it invests in shares to try to make returns for shareholders. The board of directors have the flexibility to declare the size of dividend they want to, assuming they have the profit reserve to do so.

The LIC looks at a global portfolio of shares to find the right undervalued opportunities that could deliver market-beating returns.

At 31 December 2025, the business reported it had retained earnings and profit reserves of $584 million, which is enough to maintain the minimum intended dividend rate for nine years.

Management have provided guidance that the business intends to deliver a minimum dividend per share of 13.5 cents in FY26. That'd be a year-over-year increase of 17%.

Of the last decade, FY23 is the only year that it hasn't increased its payout. That's thanks to an average portfolio return of 16.8% per year since inception in December 2013. That's an excellent track record, I'd say, though it's not guaranteed to continue at that level.

Washington H. Soul Pattinson and Co Ltd (ASX: SOL)

I view Soul Patts as the best option of all on the ASX for consistent growth.

It already holds the record for regular dividend growth – it has increased its payout each year since 1998 and it's set up to continue that impressive dividend growth, in my view.

The businesses operates as an investment house, which means it has the flexibility to make investment buys (and sell investments) to adjust its portfolio to own assets that it thinks will provide good returns for investors.

Soul Patts is invested in a number of different areas such as resources, telecommunications, industrial property, building products, swimming schools, agriculture, credit and plenty more. I expect the portfolio to change in the coming years.

By retaining some of its investment cash flow each year, the company is able to steadily invest in expanding in its portfolio and unlock the next generation of growing assets which could fund larger dividends.

I like how the ASX dividend share has made growing its dividend one of the main objectives and I think management have done it very well so far. As a bonus, a growing portfolio also helps increase the underlying value of Soul Patts shares to help drive the share price higher over time.

The post 3 ASX dividend shares raising dividends like clockwork appeared first on The Motley Fool Australia.

What sorts of ASX shares would make good investments for this objective? I'd go for businesses that have a clear objective to pay and grow dividends for shareholders.

I think there are a few names that are very appealing because of how they're set up.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

This is my favourite ASX share option for a second income because of its commitment to increasing payouts.

It's the business with the longest record of dividend growth on the ASX – it has increased its regular annual payout each year since 1998, which is a great record of stability.

The business is an investment house that has been operating for over 120 years and has paid a dividend every year during that period, through wars, pandemics, recessions, and so on.

It has built its portfolio to include a range of sectors, including resources, telecommunications, agriculture, water entitlements, energy, swimming schools, financial services, industrial property, credit, and much more.

Soul Patts has invested in numerous assets that can deliver earnings growth and enhance the portfolio's underlying value. That's a powerful combination for long-term investors who want income. The ASX share receives cash flow from its portfolio in the form of dividends, distributions and interest, which it uses to pay its own expenses, deliver a growing dividend and reinvest the rest in other opportunities for its portfolio.

Since 1998, the company's ordinary dividend has increased at a compound annual growth rate (CAGR) of 10.5% (excluding $1.09 per share of special dividends). That's a strong growth rate for building a second income.

At the time of writing, Soul Patts has a grossed-up dividend yield of 3.75%, including franking credits.

PM Capital Global Opportunities Fund Ltd (ASX: PGF)

This is a listed investment company (LIC) that focuses on international shares to build a diversified and strong-performing portfolio.

LICs are great options for dividends because it's up to the board of directors to decide the level of payment, which can be useful for a stable, growing second income.

But this LIC doesn't usually invest in tech giants, which means we get different investment exposure than other typical internationally focused exchange-traded funds (ETFs) (and LICs).

PM Capital Global Opportunities Fund is invested in areas like European banking, resources, healthcare, industrials, US banks, leisure and entertainment, consumer staples, Irish and Spanish housing, and more. It's an interesting mix of investments,

The LIC has performed strongly – in the last seven years, its portfolio has returned an average of 21% per year. But, past performance is not a guarantee of future returns.

The strength of the performance over the years has enabled the LIC to steadily increase its payout – dividends are paid from investment returns. Impressively, it grew its FY26 half-year payout by 27%. Since 2016, FY23 was the only year it didn't increase its payout (when it was maintained).

It expects to pay an annual dividend per share of at least 13.5 cents in FY26, which translates into a grossed-up dividend yield of 6.5% at the time of writing, including franking credits. That's a solid starting yield for building a second income, in my eyes.

The post Don't want to rely on your wage? Build a second income with these ASX shares appeared first on The Motley Fool Australia.

WAM's success comes after PAF's largest shareholder, PM Capital Global Opportunities Fund Ltd (ASX: PGF), reluctantly accepted its revised offer.

Despite the victory, shares in WAM Capital are flat in today's session, currently trading at $2.24 apiece.

The win follows a long saga that played out across 2021 and saw several speed bumps along the way, prompting WAM to increase its offer back in September last year.

Here are the details.

WAM to finally acquire PAF

In December 2021, PAF issued a supplementary target statement recommending its shareholders accept WAM's revised offer.

Just prior to this, on 13 December, PAF shareholders rejected the scheme. Today's update is a victory for WAM that now controls the $64 million LIC by market capitalisation.

Yesterday, WAM announced an increase in the consideration provided under its offer of 1 WAM share for every 1.95 PAF shares held. This upped the offer from every 1.99 PAF shares held.

According to a previous update, WAM noted the revised offer signified a 3.5% premium to the closing price of PAF shares on 11 January and an 18.4% premium to PAF's closing price before the scheme was announced.

In a release today, PM Capital says that it is "disappointed that the Scheme of Arrangement that it had proposed for PAF did not proceed".

The fellow LIC reluctantly accepted the offer. However, it noted the updated offer "provides PGF with the ability to exit its investment at a solid premium to [net tangible assets] NTA to the benefit of all PGF shareholders".

What's next?

Now the offer is concrete, the "governance protocols" that were established in connection with the scheme have come to an end.

Under the offer, the directors will have them moved to PGF's custodial account – which is under the control, and day-to-day management, of PGF's Investment Manager, according to the release.

Now the deal is complete, WAM's voting power in PAF will increase to 69.07%, up from 36.08% previously.

However, it seems investors have been largely unmoved by WAM's success today. It's surprising considering the takeover accounted for much of the LIC's news in 2021.

At present, WAM shares are trading sideways and are flat on the day. Also, the volume of shares traded today is just 20% of the company's 4-week average with a paltry 141,254 shares changing hands at the time of writing.

The WAM share price is also flat on its previous 12 months of trading and has climbed less than 1% in the past month.

The post WAM (ASX:WAM) share price unmoved despite victory in PAF acquisition fight appeared first on The Motley Fool Australia.

In afternoon trade, the investment company's shares are up 1% to $2.23.

Why is the WAM share price rising?

The catalyst for the rise in the WAM share price today could be news that its potential takeover of PM Capital Asian Opportunities Fund Ltd (ASX: PAF) was given a boost.

WAM is currently battling it out with PM Capital Global Opportunities Fund Ltd (ASX: PGF) for control of the fund.

In September, WAM made an off-market proposal to acquire the PM Capital Asian Opportunities Fund for one WAM Capital share for every 1.99 PAF share owned. Based on the WAM share price at the time, this implied an offer of ~$1.15 per share.

WAM believes this is superior to the offer that the PM Capital Global Opportunities Fund has made.

At the time of the offer, WAM's Chairman, Geoff Wilson, commented: "WAM's Offer to acquire 100% of PAF Shares on superior terms to the opposed Scheme provides a meaningful choice for PAF Shareholders and their investments."

"Following acceptance of WAM's superior proposal, PAF Shareholders have the option to remain a WAM Shareholder; or utilise WAM's superior on-market liquidity to exit your position at a premium to net tangible asset (NTA) backing. The Offer allows PAF Shareholders to exit their PAF Shares by acquiring 1 WAM Share for every 1.99 PAF Shares held," he added.

However, the PM Capital Asian Opportunities Fund's Board didn't see things that way and continued to recommend the offer from its Global Opportunities Fund. This led to WAM contacting the Takeovers Panel.

What's the latest?

The good news for WAM is that its takeover bid was given a boost this week after the Takeovers Panel found PM Capital had breached the Corporations Act.

The Panel found that "holding notices given by PGF, PMC and the Moore Group contravened s671B."

It also highlighted the acquisition of approximately 3.19% of PAF shares by associated entity Moore Group resulted in contraventions of s606(1), among other things.

Given that this isn't a good look for a fund manager, WAM will no doubt be hoping this strengthens its offer and weakens PM Capital's offer when it comes to voting next week. Though, it is worth noting that Paul Moore (and his associated entities) and PM Capital are seeking a review of the initial Panel's decision.

The post WAM (ASX:WAM) share price higher on PM Capital fund takeover news appeared first on The Motley Fool Australia.

So what's pushed WAM Capital up to this new high watermark?

Well, there has been some news out this morning that may be contributing to the optimism today.
WAM Capital announced that it is intending to place a bid to acquire its fellow LIC PM Capital Asian Opportunities Fund (ASX: PAF). WAM has put up an offer of 1 WAM share for every 1.99 PAF shares owned.

This offer ups the ante for shareholders in the Asian Opportunities Fund, who have already received a takeover bid from another interested party.

Earlier this month, the Asian Opportunities Fund announced it had entered into a scheme of arrangement with the PM Capital Global Opportunities Fund (ASX: PGF). The Global Opportunities Fund is a far larger LIC from the same family.

This offer constituted an offer representing the value of "PAF's after-tax net tangible assets (before deferred tax assets) per share divided by PGF's after-tax net tangible assets (before deferred tax assets) per share".

WAM Capital to add another LIC to the stable?

However, according to WAM, its new offer represents a "premium to the implied value of PAF shareholders under the [alternative] Scheme"

If the Asian Opportunities Fund ditches a "break fee" that was included in the previous scheme, WAM has offered an increased bid of 1 WAM share for every 1.975 PAF shares owned.

Here's some of what WAM chairman Geoff Wilson said on the offer this morning:

WAM Capitals' Offer is clearly superior to the proposed Scheme and we look forward to PAF's Board Committee recommending our offer to all PAF shareholders.

It is our view that the PAF board of directors have not explored all avenues to extract maximum value for PAF shareholders. The Break Fee payable by PAF shareholders, in the event the proposed Scheme does not proceed, is illogical and uncommercial…

The PM Capital Asian Opportunities Fund share price has reacted very positively today so far as well. PAF shares are currently up 5.26% to $1.10 a share.

The Asian Opportunities Fund is an LIC that primarily looks, unsurprisingly, at companies listed in Asia. It typically invests in a "concentrated portfolio of 15-35 within Asia ex-Japan". Some of its most recent disclosed holdings include iCar Asia, Sinopec Kantons and China Mobile.

At WAM Capital's current share price, this LIC has a market capitalisation of $2.08 billion with a dividend yield of 6.54%.

The post WAM Capital (ASX:WAM) share price hits new high on proposed takeover bid appeared first on The Motley Fool Australia.

Australia has a reputation for dividend-paying shares because of the higher payout ratios as well as the bonus of franking credits.

However, if you focus on businesses that are mainly based in Australia (and New Zealand) then you're missing out on the rest of the world economy.

Here are three ASX dividend share ideas to get income diversification from global sources:

Pacific Current Group Ltd (ASX: PAC)

Pacific is a global boutique asset management business which takes stakes in asset managers and helps them grow.

It has a portfolio of 15 specialist boutiques in Australia, India, Luxembourg, the US, and the UK.

Pacific's underlying funds under management (FUM) has been growing at a strong rate recently. In FY20, asset manager GQG grew its own FUM from US$25.1 billion to US$44.6 billion. Carlisle and Victory Park also grew by 31% and 19% respectively.

Excluding boutiques sold and acquired during the year, Pacific's FUM grew by 52% to $93.3 billion.

I count Pacific as a great ASX dividend share because the underlying earnings growth is helping its dividend. FY20 underlying earnings per share (EPS) went up by 18% to $0.44, helping the annual dividend jump by 40% to $0.35 per share.

At the current Pacific Current Group share price it offers a trailing grossed-up dividend yield of 8%.

PM Capital Global Opportunities Fund Ltd (ASX: PGF)

This is a listed investment company (LIC) operated by Paul Moore and his investment team at PM Capital. The purpose of a LIC is to invest in other shares, make investment gains and then the LIC can pay dividends from those investment profits.

PM Capital Global Opportunities Fund looks to invest in good businesses at a good price which are being valued differently to their long term intrinsic value and will return to their 'correct' value over time.

At the moment some the holdings in its portfolio include Cairn Homes, Bank of America, Visa, MGM China Holdings, KKR & Co, Siemens and Freeport-McMoRan.

Its portfolio is invested in businesses right around the world. At the end of September 2020, around 60% of the portfolio was invested in businesses listed in the US, 29% in Europe, 6% in Asia (excluding Japan) and 5% in the UK. Remember that the underlying earnings of those holdings are mostly global, not just from one country.

I think, at the current PM Capital Global Opportunities Fund share price, it's a global ASX dividend share to consider because it offers a grossed-up dividend yield of 6.3%. It has increased its dividend each year since 2016. It's also valued at a 16% discount to the pre-tax net tangible assets (NTA) at 9 October 2020.

Magellan Global Trust (ASX: MGG)

This is a listed investment trust (LIT) which aims to invest in the best businesses in the world.

It targets companies that can consistently exploit competitive advantages and earn good returns on capital.

Looking at its holdings, some of the businesses to make it into Magellan Global Trust's portfolio are: Alibaba, Alphabet, Atmos Energy, Eversource Energy, Microsoft, Tencent, Facebook, Facebook, Visa, Mastercard and Reckitt Benckiser.

The portfolio is a combination of both defensive and 'growth' businesses. It has worked well. After fees, the trust has delivered annual outperformance of an average of 1.35% per annum compared to the MSCI World Net Total Return Index (AUD) since inception in October 2017.

I think it's a solid idea as an ASX dividend share because it aims for a distribution yield of 4%. That handily beats what you can get from the bank at the moment. The distribution should grow as Magellan Global Trust's net asset value (NAV) increases over time.

There are also some other top dividend ideas on the ASX worth looking into.

The post 3 top global ASX dividend share ideas appeared first on The Motley Fool Australia.

When a business looks cheap, it's probably cheap for a reason. But there are businesses out there that could be too cheap for the underlying growth that they may produce over the next few years.

With that in mind, I think these ASX shares are now trading at crazy cheap prices:

Citadel Group Ltd (ASX: CGL)

I think Citadel is cheap because it's trading at 15x FY22's estimated earnings at the current Citadel share price.

The ASX software share is the market leader in healthcare software for pathology and cancer care in Australia. After the acquisition of UK business Wellbeing it is the leader in healthcare software in the UK for radiology and maternity. Management believe there are significant cross-selling opportunities with an estimated market opportunity of $250 million to $350 million of total contract value revenue in tenders over the next two to three years.

The current business is strong with a (pro forma) gross profit margin of 65.3% and (pro forma) recurring revenue being 77% of total revenue. It's a defensive business with limited impact from COVID-19.

I believe the Wellbeing acquisition is transformative for Citadel. It opens up more growth opportunities, but it also increases the quality of the earnings in my opinion.

It could acquire more bolt-on acquisitions that make sense over time, diversifying the ASX share's earnings further.

Vitalharvest Freehold Trust (ASX: VTH)

I think Vitalharvest is cheap because it's trading at a 17% discount to the net asset value (NAV) at 30 June 2020.

It's an agricultural real estate investment trust (REIT). It owns large berry and citrus farms which are leased to Costa Group Holdings Ltd (ASX: CGC), the biggest Australian horticultural company.

The ASX share receives fixed rent and variable rent from Costa. The variable rent is a 25% share of the profit of the farms that Costa rents. The drought and other issues were a big drain on profit in FY20, but it seems that is about to get better with the drought conditions improving.

New manager Primewest Group Ltd (ASX: PWG) is looking to acquire new properties that will pay more consistent rent. Properties used for food processing, storage and logistics could be more reliable. More predictable rent could be good for the Vitalharvest share price and the distribution.

The ASX share has a trailing distribution yield of 6.3%. However, I think the distribution will recover in FY21 as conditions improve.

PM Capital Global Opportunities Fund Ltd (ASX: PGF)

I think PM Capital Global Opportunities Fund is cheap because it's trading at a 21% discount to the pre-tax net tangible assets (NTA) per share at 28 August 2020.

The listed investment company (LIC) looks to invest in global businesses that it thinks are long-term opportunities.

It owns quite a diverse portfolio of businesses. Some of the ones it owns include homebuilder Cairn Homes, Bank of America, Visa, casino business MGM China Holdings, alternative asset manager KKR & Co, Siemens and copper miner Freeport-McMoRan.

Many of the holdings that it owns could rebound strongly when the global economy recovers from COVID-19 impacts.

I like that the ASX share has almost a third of its portfolio invested in European shares, which provides attractive diversification.

The LIC recently launched a share buyback and it also increased its dividend by 25% to 2.5 cents per share. At the current PM Capital Global Opportunities Fund share price it has a grossed-up dividend yield of 6.8%. That's a solid yield in the current low interest environment.

Foolish takeaway

Each of these ASX shares look attractively cheap to me. I think they could all beat the ASX over the next few years. I think Citadel will produce the biggest returns over the next few years because of its international growth and high margins. However, the other two look like good options for income investors.

The post 3 ASX shares now trading at crazy cheap prices appeared first on The Motley Fool Australia.

Australia is a great country, but it only has a small population. It's a good place to start, but businesses with global exposure have much larger growth potential due to the bigger total addressable market.

You can get that exposure either through ASX growth shares with international earnings like CSL Limited (ASX: CSL), or you can go for an investment product that offers that international growth potential.

Here are some great ideas:

A2 Milk Company Ltd (ASX: A2M)

A2 Milk could be one of the best ASX growth shares for international growth. The A2 Milk share price has fallen since the FY20 result. It's down 14% since the start of August. I think it's a good time to buy shares.

China and the USA are two big growth markets for the company.

Total A2 Milk revenue rose by 32.8% to NZ$1.73 billion in FY20. But Chinese label infant nutrition revenue more than doubled to NZ$337.7 million with store distribution growing to 19,100 stores. USA milk revenue growth rose 91.2% to NZ$66.1 million and the distribution grew to 20,300 stores – up from 13,100 at the end of FY19.

In FY21 the company is expecting continued strong revenue growth with a solid earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 30% to 31%.

I think this ASX share is one to watch. At the pre-open A2 Milk share price it's trading at 26x FY22's estimated earnings.

Magellan High Conviction Trust (ASX: MHH)

One of the best ways to get exposure to international growth could be to go for a quality listed investment trust (LIT) or company (LIC).

Magellan High Conviction Trust is a LIT that targets the best businesses in the world. A group of great companies can just keep winning year after year. The ASX share owns stocks like Alibaba, Alphabet, Microsoft, Tencent and Facebook. These are really good technology businesses that are constantly looking for ways to grow and diversify earnings.

Technology businesses are also some of the least affected by COVID-19 impacts because their service is provided digitally. Indeed, a business like Microsoft has seen a huge shift to its cloud infrastructure – bringing forward a lot of demand.

The stronger Australian dollar makes it better value to buy international shares. At the pre-open Magellan High Conviction Trust share price, the ASX share is trading at a 5.5% discount to the indicative net asset value (NAV).

PM Capital Global Opportunities Fund Ltd (ASX: PGF)

PM Capital is a well-respected fund manager which runs this LIC that looks for good value businesses when they're unloved by the market.

Some of the businesses that it owns include names like Cairn Homes, Bank of America, Visa, MGM China Holdings, KKR & Co, Siemens and Freeport-McMoRan.

I think that some of the cyclical businesses it's invested in could rebound nicely over the next few years as the global economy comes out of COVID-19.

The ASX share recently launched an off-market equal access buyback to boost the share price. It also grew its dividend in the recent FY20 result. It currently offers a grossed-up dividend yield of 6.4%, which I think is good in this low interest environment.

At the current PM Capital Global Opportunities Fund share price it's still valued at a 15% discount to the pre-tax net tangible assets (NTA) per share at 28 August 2020.

Foolish takeaway

I really like all three of these ASX shares for the international growth exposure. At the current price I think A2 Milk is too good to pass up considering it continues to grow at an impressive rate with more growth ahead as it expands its distribution network. However, both of the investment businesses look good value today too.

The post 3 ASX shares to buy for international growth appeared first on The Motley Fool Australia.

However, just because something has a seemingly big dividend yield doesn't mean it's automatically a good choice. Just look at Commonwealth Bank of Australia (ASX: CBA) – its final dividend was cut heavily and the next interim dividend could be cut too.

I don't think there are many ASX blue chips with large yields that could solid dividend payers during this period. Wesfarmers Ltd (ASX: WES) and APA Group (ASX: APA) would be two blue chips I'd be happy to rely on for income. The problem is that their starting yields aren't that high.

These ASX dividend shares have big yields and I think the dividends will grow over time:

Naos Emerging Opportunities Company Ltd (ASX: NCC)

This business is a listed investment company (LIC) which invests in small ASX shares with market capitalisations under $250 million. This is the small end of the ASX.

One of the main benefits of LICs is that fund managers can make investment returns – largely capital gains – and then it can steadily pay out those gains as a smoothed dividend.

The Naos LIC has done very well with its dividend. It started paying a dividend in FY13 and it has grown or maintained its dividend every year since.

At the end of July 2020 the ASX dividend share offered a grossed-up dividend yield of 12.3%. At the current Naos Emerging Opportunities Company share price it's trading at a 13.5% discount to its pre-tax net tangible assets (NTA) per share. That means you can buy $1 for shares for $0.875

At the end of last month it had nine positions in its portfolio., so it's a high conviction portfolio. But it offers diversification as well.

Vitalharvest Freehold Trust (ASX: VTH)

Vitalharvest is a real estate investment trust (REIT) which owns agricultural farmland. Specifically, it owns berry and citrus fruit farms. At the moment all of its farms are leased to Costa Group Holdings Ltd (ASX: CGC).  

The ASX dividend share generates rental income in two ways. It receives a fixed rental income from Costa and it also has a profit share agreement – it receives 25% of the profit from the farms.

Costa's earnings have been troubled over the past couple of years because of the drought, crumbly berries and fruit flies at the citrus farms. Despite all of those issues, Vitalharvest's distribution still amounts to a 6% yield today.

If profitability per share returned to the 2019 levels then Vitalharvest's distribution yield could be 7.1%.

The ASX dividend share has recently switched managers. The new one will be looking for acquisitions to increase diversification and boost the rental profit (and the distribution). The new targets may offer a more stable income as well.

PM Capital Global Opportunities Fund Ltd (ASX: PGF)

PM Capital Global Opportunities Fund is another LIC. This one targets overseas shares.

The ASX dividend share has a current grossed-up dividend yield of 6.5%. The LIC just increased its final dividend by 25% to 2.5 cents per share. If it pays another 2.5 cents per share dividend in six months then it will have a grossed-up dividend yield of 7.25% today.

Some of the shares that it currently owns includes Visa, Siemens, Bank of America, Freeport-McMoRan, Oracle, KKR & Co and Alphabet (Google).

It has increased its dividend each year since 2016 and it could keep growing its dividend over the long-term if its investments turn out well.

At the current PM Capital Global Opportunities Fund share price it's trading at a 16.5% discount to the NTA at 7 August 2020.

Foolish takeaway

Each of these ASX dividend shares offer something different for income investors. The Naos LIC has a huge yield. Vitalharvest offers alternative income with its food-related properties. PM Capital Global Opportunities Fund has a steadily-growing dividend with good diversification.

The post 3 ASX dividend shares offering big yields appeared first on The Motley Fool Australia.

Quick overview of PM Capital Global Opportunities Fund

PM Capital Global Opportunities Fund is a listed investment company (LIC). The job of a LIC is to invest in other shares. As the name might suggest, the LIC invests in global shares which it thinks are opportunities.

Fund manager business PM Capital, run by Paul Moore, operates this LIC. It aims to be invested in between 25 to 45 global companies. PM Capital has been investing for over 30 years.

FY20 result

The COVID-19 share market selloff caused PM Capital Global Opportunities Fund's share portfolio to drop in value over the year. This caused its net revenue to drop to negative $22.1 million. It saw a net loss of $18.7 million.

The LIC disclosed that its portfolio's net return after fees and expenses was a negative 6.4%, compared to the MSCI World Net Total Return Index return of 4.8%. However, looking at its 22-year track record shows clear outperformance of the MSCI, by 4.38% per annum.

Manager of PM Capital Global Opportunities Fund, Paul Moore, said that the LIC has been adding to its positions in resource businesses across various commodities including Freeport-McMoRan (copper), Newmont Mining (gold), Teck Resources (copper and zinc) and Boliden (zinc). It increased its positions in industrial stocks like Siemens and also re-established a position in Alphabet (Google).

But he believes that there is potential for good longer-term returns. Mr Moore said: "We feel the pandemic has not simply delayed our thesis, but the fiscal and monetary actions will have the effect of essentially making the thesis inevitable. The unknown factor is the timing. In the short-term, behavioural biases have not declined and their effects will be exaggerated by the weight of the index funds. This is why it is so important to have a longer time horizon so as to let the thesis play out to its full extent and in doing so profit from it. It is amazing how often – if one has patience – the conventional "wisdom" proves itself to be wrong."

Shareholder returns

PM Capital Global Opportunities Fund announced two shareholder return initiatives.

The LIC has announced a final dividend of 2.5 cents per share, which is a 25% increase on FY19's final dividend and the FY20 interim dividend. The full year dividend of 4.5 cents per share equates to a grossed-up dividend yield of 6.6% at the current PM Capital Global Opportunities Fund share price.

Income-focused investors will probably see the bigger payout as a welcome increase. Particularly as the RBA interest rate is now very low. 

The LIC also announced an off-market equal access buy-back. It will buy up to 5% of the shares held by each shareholder at a price set at a 5% discount to the post-tax net tangible assets (NTA) (excluding deferred tax assets) at the close date which is 23 October 2020.

The PM Capital Global Opportunities Fund board believes this is an efficient way to allow shareholders to obtain value close to the NTA in circumstances where the shares are trading at a discount to the NTA. 

Largest positions

At the end of FY20 its biggest positions were (in order): Apollo Global Management, Freeport-McMoRan, Bank of America, MasterCard, KKR & Co, Visa, Siemens, Oracle, JPMorgan Chase, Caixa Bank, Lloyds Banking Group, Howard Hughes, Ares Management, Sands China and ING.

Each of the above positions had a market value of more than $10 million at the end of FY20.

Current valuation

At the current PM Capital Global Opportunities Fund share price of $0.98, it's trading at a 17% discount to the 7 August 2020 NTA of around $1.18.

The post Why the FY20 result sent the PM Capital Global Opportunities Fund share price up 4% appeared first on The Motley Fool Australia.

Here is what the team have come up with…

Kate O'Brien: AGL Energy Limited (ASX: AGL)

For a side of certainty with my dividends, I would be looking to AGL Energy. The company operates Australia's largest energy portfolio, generating gas and electricity and selling it to end users. While COVID-19 may have shut down industries across Victoria, it can't turn off demand for energy. This provides a degree of reliability for AGL's earnings. AGL targets a dividend payout ratio of 75% and has predicted full year profits in the upper half of its guidance range. At the time of writing, the AGL share price is yielding 6.52% and is still around 20% down from its 2020 high. 

Motley Fool contributor Kate O'Brien does not own shares in AGL Energy Limited. 

Chris Chitty: Fortescue Metals Group Limited (ASX: FMG)

Fortescue Metals Group has seen significant success recently as a result of a surging iron ore price. Not only is this company offering potential earnings growth, it has a trailing dividend yield of 5.44% fully franked (at the time of writing). In the financial year to 30 June 2020, Fortescue Metals shipped over 178 million tonnes of iron ore with C1 cash costs of just US$12.94, this is against a current iron ore spot price of more than US$100 per tonne. With China hungry for iron ore as it builds up its infrastructure, I believe Fortescue is in a great position to continue paying large dividends.

Motley Fool contributor Chris Chitty does not own shares in Fortescue Metals Group Limited.

Toby Thomas: Charter Hall Long WALE REIT (ASX: CLW)

I've been keeping an eye on this real estate investment trust (REIT) for a while now, and think it could be a dividend harvester for a long time to come. Last week, the property trust announced its full-year results for FY20, which included a 5.2% rise in operating earnings and statutory profit of $122 million. The REIT currently pays out an annual dividend yield of around 5.8%, and is highly attractive for its average lease duration spanning a whopping 14 years. That provides long-term security for shareholders, who have the peace of mind knowing that blue-chip tenants such as  Woolworths Group Ltd (ASX: WOW), Telstra Corporation Ltd (ASX: TLS), BP and Coles Group Ltd (ASX: COL) will continue to pay rent for the foreseeable future.

Motley Fool contributor Toby Thomas does not own shares in Charter Hall Long WALE REIT, Woolworths Group Ltd, Telstra Corporation Ltd or Coles Group Ltd.

Lloyd Prout: CSL Limited (ASX: CSL)

CSL is the largest company on the ASX, but it definitely isn't the cheapest at approximately 46x earnings (at the time of writing). But, with around a 1% dividend yield and currently trading approximately 18% below its February highs, I think the CSL share price provides long-term investors a great total return opportunity.

CSL's plasma collections have been impacted by COVID-19, but over the long term the business should recover and the company should continue to grow earnings at a double-digit rate. The company also has a relatively low payout ratio of under 50%, providing room to grow the dividend even if earnings are flat.

Motley Fool contributor Lloyd Prout does not own shares in CSL Limited and expresses his own opinion.

Tristan Harrison: PM Capital Global Opportunities Fund Ltd (ASX: PGF) 

PM Capital Global Opportunities Fund is a listed investment company (LIC) that invests in international shares which are usually unloved by the market.  

It currently has a grossed-up dividend yield of around 6.1%, at the time of writing, and it has grown its dividend each year since 2016 when it started paying one. It has an outlook of growing dividends.  

The LIC has diversified holdings like KKR & Co Inc, Visa Inc, Siemens AG and Freeport-McMoRan Inc. It's also trading very cheaply – its share price is trading at around a 19% discount to the 31 July 2020 net tangible assets (NTA). I think it's a good way to diversify your income stream.  

Motley Fool contributor Tristan Harrison owns shares of PM Capital Global Opportunities Fund Ltd. 

Daryl Mather: Charter Hall Retail REIT (ASX: CQR)

The Charter Hall Retail REIT is focused on shopping centres like several other REITs. However, it is focused on neighbourhood and sub-regional centres. For example, the company owns a shopping centre in Albany, WA as well as Townsville, QLD. These centres are anchored by supermarkets and typically contain non-discretionary stores like chemists.

I think the market has misjudged the impact of coronavirus on these assets. The REIT currently has a trailing 12-month dividend yield of around 6.2%. Its share price is down 24.24% year to date (at the time of writing) and it has a market capitalisation that is about 76% of its net tangible assets.

Motley Fool contributor Daryl Mather does not own any shares of Charter Hall Retail REIT.

Brendon Lau: Amcor PLC (ASX: AMC)

The global packaging group may sound like an unexciting income share with a yield between 4%-5%, but unexciting is exactly what income investors need right now. Amcor's earnings are expected to be relatively stable during the COVID-19 mayhem given its large exposure to the consumer staples and medical industries. This means it's unlikely to cut its dividend. What's more, unlike most other ASX 200 shares, Amcor pays its dividend quarterly.

Motley Fool contributor Brendon Lau does not own shares of Amcor PLC. 

Glenn Leese: Platinum Asset Management Ltd (ASX: PTM)

Platinum Asset Management is a pooled investment sponsor. Essentially, it provides services to hedge and mutual funds by helping with launches and management. Platinum also invests in the share market directly, applying a value investing strategy across consumer, health care and technology sectors. With the current state of the world, these sectors are excellent targets.

For more than 10 years, Platinum has delivered a stable and increasing dividend. The yield has nearly doubled since 2009, from 3.6% up to 6.99% at the time of writing, making it my top dividend stock pick.

Motley Fool contributor Glenn Leese does not own any shares in Platinum Asset Management Ltd.

Bernd Struben: Sonic Healthcare Limited (ASX: SHL)

Sonic Healthcare Limited was established in 1987. Today, Sonic Healthcare is the world's third largest pathology/laboratory medicine company with a market cap of around $16 billion. Based in Sydney, it operates in 8 countries.

The company has an enviable track record of growing — or at the very least maintaining — its total dividend per share payout dating all the way back to 1994.

The last interim dividend of 34 cents per share was paid on 25 March, for an annual dividend yield of 2.5%, partially franked at 30%.

Atop its reliable dividends, the Sonic Healthcare share price has gained nearly 19% year to date.

Motley Fool Contributor Bernd Struben does not own shares in Sonic Healthcare Limited.

Michael Tonon: WAM Global Ltd (ASX: WGB)

Not many companies are in the position to increase their current dividend payment, let alone announce a 100% increase. However, this is exactly what listed investment company (LIC) WAM Global has recently done.

WAM Global is an LIC which manages a diversified portfolio of global companies. With the current increase in its final dividend, it now pays shareholders a 5% fully-franked dividend (grossed up), with enough profit reserves to cover this payment for at least the next 3 years.

In addition, it has been growing its dividend rapidly since it began paying in 2019 and currently also trades at a ~12% discount to its net tangible assets (NTA) when compared to July's before tax NTA of $2.28. 

Motley Fool contributor Michael Tonon owns shares in WAM Global Ltd. 

Matthew Donald: Charter Hall Long WALE REIT (ASX: CLW)

Charter Hall Long WALE REIT has a diversified property portfolio across industrial & logistics, office, long WALE retail, telco exchange and agri-logistics sectors. Its strong tenants, which include government, ASX-listed and multinational companies, have helped the group deliver solid full year results announced last week.

COVID-19 hasn't had a significant impact on the business. Additionally, from FY17 it has been able to deliver an average distribution growth rate of 3% to FY20.

Going forward, due to its diverse property portfolio and quality tenants, I believe the group will be able to deliver continued distribution growth to investors.

Motley Fool contributor Matthew Donald does not own shares in Charter Hall Long WALE REIT.

Phil Harpur: JB Hi-Fi Limited (ASX: JBH) 

Electronics retailer JB Hi-Fi has continued to perform well financially, despite the challenges of the coronavirus pandemic. For the half year so far (to early June), JB Hi-Fi reported sales up 20% over the prior corresponding period. Demand has been particularly strong during the pandemic for technology products. I am particularly attracted to JB Hi-Fi as a retailer because its online channel is more developed than some of its other bricks and mortar competitors such as Harvey Norman Holdings Limited (ASX: HVN). Online sales have been booming during the crisis. JB Hi-Fi also pays a fully-franked forward dividend yield of around 3.3%.

Motley Fool contributor Phil Harpur does not own shares in JB Hi-Fi Limited or Harvey Norman Holdings Limited.

Sebastian Bowen: CSL Limited (ASX: CSL)

CSL is not normally considered a strong ASX dividend share. And fair enough too – on recent prices, you can only expect a dividend yield of around 1%. But I think CSL is an underappreciated dividend star. It has increased its payouts by an average of 15% per annum since it first started sending cash out the door in 2013. If this continues, it won't be long until CSL is a dividend heavyweight in its own right. And investors who get in early will benefit the most. As such, I think CSL is a top dividend pick today for income down the road.

Motley Fool contributor Sebastian Bowen does not own shares in CSL Limited.

James Mickleboro: BWP Trust (ASX: BWP) 

I think that BWP Trust would be a great dividend option for investors in August. It is an REIT that invests in and manages commercial properties throughout Australia. The majority of its properties are leased to home improvement giant Bunnings Warehouse. These are high quality assets which have actually increased in value during the pandemic. This is quite the opposite to what is happening with most retail properties right now. In FY 2021, BWP intends to pay a distribution in the region of 18.3 cents per unit. This works out to be an attractive 4.6% yield based on the current BWP share price, at the time of writing.

Motley Fool contributor James Mickleboro does not own shares in BWP Trust. 

Nikhil Gangaram: Nick Scali Limited (ASX: NCK)

Nick Scali is my dividend pick for August. Despite the chaos caused by the COVID-19 pandemic, the furniture retailer recently surprised the market with its results for FY20, whilst also predicting a bumper FY21.

For the 12 months to 30 June, Nick Scali reported revenue of $262.5 million and net profit of $42.1 million. In addition, the company cited a strong order book and expects earnings to jump 50% for the first half of FY21. As a result, Nick Scali increased its final dividend by 12.5%, with the company set to pay out 22.5 cents per share.

Motley Fool contributor Nikhil Gangaram does not own shares in Nick Scali Limited.  

Daniel Ewing: AGL Energy Limited (ASX: AGL)

AGL has been hard hit by the pandemic, despite it traditionally being considered a safe haven asset. AGL operates and owns Australia's largest energy generating portfolio. Thus, it is convenient that the public's need for electricity is incessant. Furthermore, Victoria is having to endure a second lock down in the middle of winter. Shareholders will be hoping this causes an uptick in utility consumption that will provide a meaningful boost to earnings for the energy giant. AGL currently offers a trailing dividend of 6.52% on current prices. With franking at 80%, the yield is nothing to be scoffed at.

Motley Fool contributor Daniel Ewing does not own shares in AGL Energy Limited.

The post Top ASX dividend shares to buy in August 2020 appeared first on The Motley Fool Australia.

Choosing where to put your hard-earned money can be a difficult task. Particularly with how volatile the share market has been in recent months due to COVID-19.

Here are my picks:

Share 1: PM Capital Global Opportunities Fund Ltd (ASX: PGF) – $2,500

This ASX share is a listed investment company (LIC) which focuses on overseas shares. I think there's merit in finding LICs which are trading at large discounts to their net tangible assets (NTA) per share but have a relatively large dividend yield.

I think PM Capital Global Opportunities Fund is good value because it's probably trading at around a 20% discount to the NTA at the end of last week. The weekly NTA update will be released tomorrow. This is a large discount in the LIC sector. 

Some of the LIC's current holdings are: Cairn Homes, Bank of America, Visa, MGM China, KKR & Co, Siemens and Freeport-McMoRan Copper.

The ASX share has been steadily increasing the dividend over the past few years. Since 2017 the annual dividend has grown annually by 0.2 cents per share. In FY20 the annual dividend seems set to increase to 4 cents per share, up from 3.8 cents per share in FY19. At the current PM Capital Global Opportunities Fund share price it has a projected FY20 grossed-up dividend yield of 6.2%.

Share 2: Bubs Australia Ltd (ASX: BUB) – $3,500

Bubs is one of my main ASX growth share ideas at the moment. The goat milk product business is seeing large demand for its infant formula range.

The business has been growing quarterly revenue at a very good rate for a while now. But the quarter to 31 March 2020 was truly impressive. Bubs' quarterly revenue of $19.7 million was a 67% increase year on year and a 36% increase compared to the previous quarter. Bubs' infant formula revenue jumped 137% and Chinese revenue rose by 104%.

I really like what Bubs has achieved over the past couple of years, particularly with securing its supply chain and expanding its distribution footprint.

Good news continues to flow from the ASX share. It recently announced its (cow-based) grass fed infant formula will be sold in 482 Coles Group Limited (ASX: COL) supermarkets. In that same announcement it said that Baby Bunting Group Limited (ASX: BBN) would start selling Bubs' range of products in 52 stores from May 2020.

I think Bubs is definitely one to watch over the next five years. I'd be happy to buy shares at the current Bubs share price.

Share 3: WCM Global Growth Ltd (ASX: WQG) – $4,000

Many of the best shares in the world are not listed on the ASX. Indeed, the ASX only makes up 2% of the global share market. I think it could be a mistake to miss out on the other 98% of the world.

ASX share WCM Global Growth is another LIC which also targets global shares. It looks for shares with an expanding economic moat, measured by a rising return on invested capital (ROIC). Businesses with a large but static (or declining) moat won't make the cut.

WCM, a Californian based asset management firm, also looks for a good corporate culture that will enable that share's economic moat to keep growing.

The ASX share's investment portfolio has been a strong performer. Over the past two years, after management fees and performance fees, WCM's portfolio has returned an average of 23.1% per annum, outperforming its global benchmark by 13.5% per annum.

Some of its top holdings at the end of May 2020 include Shopify, Stryker Corp, MercadoLibre, Visa and Crown Castle International.

A useful bonus is that the ASX share recently started paying a dividend. At the current WCM Global Growth share price it offers a dividend yield of 3.1%. It's currently trading at a 10% discount to the NTA at 26 June 2020.

Foolish takeaway

I think all three of these ASX shares could outperform the local market over the short-term and particularly the long-term. I believe Bubs has great growth potential. The two global LICs are invested in good shares and are valued at attractive discounts to their NTAs.

The post Have $10,000 to invest? I'd pick these ASX shares appeared first on The Motley Fool Australia.

The best performers over the last few months have been growth shares that are leveraged to the change in the way that people are now spending or living. Usually those strong performers have a strong digital presence. Some of the ASX shares that have performed really well have been Afterpay Ltd (ASX: APT), Temple & Webster Group Ltd (ASX: TPW) and Pushpay Holdings Ltd (ASX: PPH). I think it will be hard for them to perform as well over the next six months as the last six months.

It's getting harder to find good value. The businesses that are doing well are priced highly and the rest face a lot of uncertainty over the next six months or longer.

But I think there are some ASX shares like LICs that look good value which are trading at an attractive discount to their net tangible assets (NTA).

You may be wondering what a LIC actually does. It's pretty simple, it's just a listed investment fund that invests in other shares on your behalf. I think globally-focused LICs are good investment ideas because ASX shares only represent 2% of the global share market. You may be missing out on exposure to good opportunities. 

Overview of ASX share PM Capital Global Opportunities Fund

It's a LIC that invests in international shares. It's run by PM Capital, an investment management business led by Paul Moore. The ASX share was listed in December 2013, though there has been an unlisted version of the fund operating since October 1998.

The LIC charges a management fee of 1% per annum of the portfolio and a performance fee of 15% of the investment return above the benchmark return. The benchmark is the Morgan Stanley Capital International World Index (AUD).

What shares does it invest in?

The ASX share can invest in any global share. It's not restricted by country, industry sector or market capitalisation. It only invests in businesses that it has conviction in. It generally holds around 40 globally listed shares in its portfolio.

Each month the LIC discloses what percentage of its portfolio is invested in a particular theme or sector. At the end of May, 8% of the portfolio was invested in businesses related to housing Ireland and Spain, global domestic banking was a 24.4% weighting, service monopolies had a 14.8% allocation, Macau gaming was a 8.3% weighting, alternative investment managers had a 12.6% allocation, industrial European businesses had a 6.7% allocation, materials had a 11.4% weighting and 'other' had a 12% allocation.

The LIC can also short shares if it wants to. It had short positions amounting to 8.2% of the portfolio at the end of May 2020.

Some of the actual names it actually owns include: Cairn Homes, Bank of America, Visa, MGM China, KKR & Co, Siemens and Freeport-McMoRan Copper.

Why I think it's good value

I think the ASX share represents good value. Many of the businesses that it's invested in are somewhat cyclical, those shares have been punished more than others due to COVID-19. I'm not expecting rapid returns, but some of those holdings do look cheap. When investing in cyclical shares the best time to invest is during the bottom of a cycle.

PM Capital Global Opportunities Fund releases a weekly NTA update. At 26 June 2020 it had NTA before tax of $1.12 per share. This is an 18% discount to the current PM Capital Global Opportunities Fund share price of $0.92.

The large NTA discount also boost the potential dividend yield from the ASX share. Assuming it pays 4 cents per share over the next 12 months, it has a grossed-up dividend yield of 6.2%.

Foolish takeaway

I think that over the next 24 months, or less, the shares that the LIC owns could perform well as the global economy recovers to a new normal. I'd be very happy to buy some shares today for the long-term. Both for capital growth and dividends. 

The post My ASX share of the week appeared first on The Motley Fool Australia.

Aussies should want their money to work as hard as it can to grow their wealth for the long-term.

Vanguard Australian Shares Index ETF (ASX: VAS) isn't a terrible choice. It has low costs and (normally) a decent dividend yield. However, a large percentage of it is invested in the big four ASX banks of Westpac Banking Corp (ASX: WBC) and its peers.

I think Aussie investors can do better for their portfolio than that. Here are three ideas:

Share 1: BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

I believe there are several exchange-traded funds (ETFs) that Aussies can buy that would provide better returns than the Vanguard Australian Shares Index ETF over the long-term.

This ETF is invested in around 200 international climate change leaders (as measured by their relative carbon efficiency) and they "are not materially engaged in activities deemed inconsistent with responsible investment considerations".

Its top 10 exposures are: Apple, Mastercard, Visa, Nvidia, Home Depot, Adobe, Paypal, Toyota, Netflix and ASML. As you can see, it has excluded some of the biggest businesses in the world like Facebook, Alphabet and Microsoft.

But the returns of the ETF haven't been hampered by the lack of those big names. At the end of May 2020 it had returned 33% over the prior 12 months. Over the past three years it had returned 19.75% per annum. Since inception in January 2017 it had returned 21.2% per annum. I think those are compelling returns. Plus, those returns are after fees. The ETF charges 0.59% per annum, which is good value considering there are ethical screens for the shares involved.

With this ETF I like that you get great international diversification, strong returns and it can align your investments with your values, if that's what you're aiming for.

Share 2: PM Capital Global Opportunities Fund Ltd (ASX: PGF)

At a share price of $0.89 I think listed investment company (LIC) PM Capital Global Opportunities Fund looks really good value.

The job of a LIC is to invest in shares on your behalf. PM Capital Global Opportunities looks to invest in good value non-ASX shares. The strengthening Aussie dollar makes this a good time to invest in overseas shares.

PM Capital Global Opportunities is invested in shares like Visa, KKR & Co and Siemens. It has a diversified portfolio and it is able to short shares, where it can make money if share prices go down. At the end of May, 8.2% of its portfolio was in short positions.

I think it looks great value right now because the share price is valued at a 24% discount to the pre-tax net tangible assets (NTA) at 19 June 2020. The NTA has probably reduced since then, but a 20% discount would still be great value in my opinion.

Share 3: Bubs Australia Ltd (ASX: BUB)

At a share price of $0.92 I think this ASX share looks increasingly good long-term value.

If you look at today's revenue versus the market capitalisation then Bubs doesn't look exciting. But as investors we need to think where businesses might be in a few years from now.

Bubs is growing at a very fast pace. In the quarter to 31 March 2020 it generated record quarterly revenue of $19.8 million – this was growth of 67% compared to the prior corresponding period and it represented growth of 36% compared to the previous quarter.

I think there's plenty more growth in store for the goat milk infant formula business. Asia is a very large market that Bubs is targeting. Vietnam and China growth alone could turn Bubs into a much larger business. Also, Bubs' profit margins are growing as it benefits from the economies of scale effect. 

The fact that Bubs recently turned cashflow positive is a very good step for a business in the current COVID-19 circumstances. I think Bubs is definitely one ASX share to watch over the next five years.

Foolish takeaway

I'd be happy to invest $1,000 into one of the above ASX shares. Indeed, at these prices I'd be happy to invest a lot more than just $1,000. The short-term may be volatile, but I think all three shares can beat the ASX index over the long-term at the current prices.

The post Do you have $1k to invest? Buy 1 of these ASX shares appeared first on The Motley Fool Australia.

When you look at the ASX there seems to plenty of shares that fit into one of two categories. They are either domestically-focused businesses with low growth and (usually) a high dividend yield like miners or banks such as Commonwealth Bank of Australia (ASX: CBA). Or there are growth shares that are highly priced with international growth plans such as Afterpay Ltd (ASX: APT).

I believe there are some ASX shares that can give a decent income whilst also giving exposure to great international shares with good growth. Here are three of those ideas:

Share 1: Magellan Global Trust (ASX: MGG)

This is a listed investment trust (LIT) which invests in the best businesses in the world. Magellan Global Trust can turn some of the capital return growth that it makes into distributions to shareholders. The ASX share targets a 4% distribution yield, so that's the income part covered.

The shares that it's invested in have strong economic moats. Some of the shares it's invested in are: Alibaba, Alphabet, Atmos Energy, Facebook, Mastercard, Microsoft, Reckitt Benckiser, Tencent, Visa and Xcel Energy.

Since inception in October 2017, its net portfolio performance (after fees) has been 12.5% per annum, outperforming the MSCI World Net Total Return Index (AUD) by 1.5% per annum. Those numbers are to the end of May 2020, which includes the COVID-19 sell-off.

Over time, the best businesses in the world can act like compound growth machines. A benefit of Magellan Global Trust is that it can invest anywhere in the world, it's not limited to a particular country or weighting with its share investments.

Share 2: PM Capital Global Opportunities Fund Ltd (ASX: PGF)

This is a listed investment company (LIC) which looks to invest in businesses which are good value.

Some of the shares that it currently owns include European homebuilder Cairn Homes, Bank of America, Visa, MGM China, KKR & Co, Siemens and Freeport-McMoRan Copper.

The ASX share currently has a grossed-up dividend yield of 6.3%. Part of the reason why the yield is quite high is because the current share price of $0.90 is at a 23% discount to the net tangible assets (NTA) at 19 June 2020, which was the latest weekly NTA disclosure. I think that represents great value. PM Capital aims to grow the dividend over time. I believe that's an attractive feature and will help close the NTA discount.

Some of the shares that the LIC owns has been sold off heavily due to COVID-19. At them moment its net performance is only showing a return of 8.1% per annum since inception. But I believe today's share price offers very compelling value.

Share 3: WAM Global Limited (ASX: WGB)

WAM Global is the international version of WAM Capital Limited (ASX: WAM). It looks for undervalued growth companies listed overseas which could deliver good returns.

The investment team at Wilson Asset Management are happy to change the portfolio as conditions change. At the moment some of the biggest holdings are: Tencent, Amazon, Activision, Auto Zone, CME Group, Costco, Dollar General, Hasbro, Hello Fresh, Intuit, Logitech and Microsoft.

The ASX share currently has an annualised grossed-up yield of 4.5%. This yield will probably grow in time, just like it has at the other WAM LICs.

One of the things that I like about WAM Global is that it isn't afraid to go to fairly high levels of cash during volatile periods. Cash is good for protection and opportunities. At the end of May 2020 it had a cash weighting of 14.8%.

It's currently trading at a 17.3% discount to the 31 May 2020 NTA.

Foolish takeaway

I like each of these shares for what international diversification they offer. I think all of them are trading at good value, particularly PM Capital Global Opportunities Fund which is valued at a large NTA discount. 

The post 3 top international ASX shares for growth and income appeared first on The Motley Fool Australia.

The share market is recovering from the coronavirus selloff a few months ago. The ASX is still down compared to its mid-February level.

You don't need to have $20,000 to start investing in ASX shares. You don't even need to have $1,000. People can start with as little as $500.

It may be hard to know where to start investing with $1,000. I've got some ideas for you.

An exchange-traded fund (ETF)

iShares S&P Global 100 (ASX: IOO). The stronger Australian dollar puts Aussies in a good position to buy international shares.

This ETF invests in the biggest global businesses. I like that this ETF is invested in businesses from various countries like the US, France, Switzerland and so on. It's not based on one country, region or industry. 

ASX shares aren't the only companies worth investing in. The ETF is currently invested in shares like Microsoft, Alphabet and LVMH.

A diversified ETF

Vanguard Diversified High Growth Index ETF (ASX: VDHG). It can be hard to know which ETF to go for. So why not choose a diversified ETF which invests in several other ETFs?

It's invested in large cap ASX shares, international shares, smaller shares and bonds.

This ETF is the type of pick that could be your only investment and you'd do quite well with it. It doesn't have the best growth credentials compared to some other ETFs, but it will be good enough with low costs.

Quality listed investment companies (LICs)

I think that WAM Microcap Limited (ASX: WMI) and PM Capital Global Opportunities Fund Ltd (ASX: PGF) are two of the best LICs to go for right now.

WAM Microcap invests in small cap ASX shares. PM Capital Global invests in international shares. WAM Microcap seems set up to perform well with its small cap hunting ground. Meanwhile, global shares can offer up many more opportunities than our domestic market.

Both of these LICs had made strong long-term returns before COVID-19. I believe this performance will return as the market recovers. They also both have pretty high dividend yields.

ASX small cap shares

The smaller shares on the ASX could be some of the best opportunities. Small caps are much earlier along in their growth journey.

I really like Pushpay Holdings Ltd (ASX: PPH) and Bubs Australia Ltd (ASX: BUB). Both of them are now cashflow positive and they're still generating huge revenue growth. The horrible circumstances actually seem to be accelerating the growth of both businesses.

In five years they could be two of the best mid cap shares on the ASX.

A great investment conglomerate

There aren't many conglomerates on the ASX. Some investors don't like conglomerates because of all the moving parts and the complicated structure. But I really like Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). It has been operating for over a century, it continues to grow and diversify its investment portfolio and pays an ever-growing dividend. The ASX share is still down more than 10% from the pre-coronavirus high.

A cheap construction

Brickworks Limited (ASX: BKW) is one of the best value ASX shares right now in my opinion. Brickworks construction company is a large shareholder in Soul Patts and it also owns a growing industrial property trust. The value of these two assets alone make Brickworks seem cheap.

The best time to buy a cyclical construction business is when confidence is low, such as this period. Construction will return to a more normal level at some point, so I think it could be opportunistic to buy Brickworks whilst things look uncertain. The US and Australian governments will be counting on construction for some of the economic recovery.

Foolish takeaway

I believe each of these shares are great opportunities for the long-term. At the moment I think one of the LICs, Brickworks, Bubs and Pushpay are more likely to generate the stronger returns over the next three years. It depends whether you're looking for income or capital growth.

The post Have $1,000? You should pick one of these 8 ASX shares appeared first on The Motley Fool Australia.

The current coronavirus economic conditions make it hard to know what's going to happen next. But I believe that society will get through this in the next couple of years. Once we're through the worst of this the ultra-low interest rates will make shares seem very attractive.

Here are the four shares I'd buy with $20,000 right now:

Pushpay Holdings Ltd (ASX: PPH) – $6,000

I think Pushpay is one of the most promising shares to invest in on the ASX. It's an electronic donation business which predominately services large and medium US churches. It was on a good growth trajectory before COVID-19, but the current conditions have accelerated that growth.

Being able to electronically donate to your church is very useful in a socially distancing world where cash isn't ideal. Pushpay's FY20 was strong and in FY21 the company is expecting earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) to approximately double.

The Pushpay share price has been a strong performer recently, but the increased growth more than makes up for that in my opinion.

Brickworks Limited (ASX: BKW) – $5,000

I think Brickworks is one of the best value ASX 200 shares at the moment. When you take its defensive & reliable assets of its Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) shares and 50% stake of the industrial property trust at book value, you'll see that combined value essentially supports the Brickworks market capitalisation.

The rest of the business – its building products divisions – come for free. I think that's a useful way to look at it because construction earnings are going to be down because of the coronavirus impacts.

Until construction comes back, which may be sooner than some expect, investors will get to collect the grossed-up dividend yield of 6.1%.

Magellan Global Trust (ASX: MGG) – $5,000

This is a listed investment trust (LIT) which invests in the best global shares. Some of its top holdings include Alibaba, Alphabet, Atmos Energy, Microsoft, Tencent, Facebook, Visa, Mastercard, Reckitt Benckiser and Novartis.

The LIT is invested in businesses which could prove to be quite defensive in the face of the coronavirus, their growth may even accelerate due to customer habits changing.

Despite the fees, Magellan Global Trust's net return is impressive and regularly outperforms its global benchmark. Particularly over longer time periods.

As a bonus the LIT is a decent income share, it targets a 4% distribution yield. It's currently trading at a small discount to its net asset value (NAV).

PM Capital Global Opportunities Fund Ltd (ASX: PGF) – $4,000

This is a listed investment company (LIC) which also invests in global shares. It's always looking for unloved global shares that could make strong returns.

It's invested in various ideas such as alternative investment managers, house builders in Europe, resources and others. That translates into share holdings like KKR & Co, Freeport-McMoRan Copper and Cairn Homes.

PM Capital Global Opportunities Fund has an attractive trailing grossed-up dividend yield of 6.3%.

It's trading at 15% discount to the weekly net tangible assets (NTA) at 15 May 2020.

Foolish share takeaway

I really like all of these shares for different reasons. I think Pushpay could be the strongest performer over the next three to five years, but Brickworks could be very reliable whilst the two global investment businesses offer good portfolios for investors to get exposure to.

The post Where to invest $20,000 into shares right now appeared first on The Motley Fool Australia.

At the moment the S&P/ASX 200 Index (ASX: XJO) is down around 22% from the pre-coronavirus heights. Ignoring that the share market has been even lower, I think today's lower price is broadly attractive. (However, I wouldn't call every share a buy just because it's priced lower.)

The thing is, our 65-year-old selves don't suddenly wake up with a $1 million share portfolio out of thin air. It takes a lifetime of good financial habits, saving your dollars and investing diligently, to build that kind of wealth.

No-one can know how generous (or not) the Australian pension will be in two or three decades from now in 'real' terms. I'd bet it won't be as generous as today as the demographics change.

If you want to have a good portfolio when you retiree you need to starting building it today. Or at least as soon as you can.

Would you rather buy shares when they're priced 20% lower or 20% higher? I think it's obvious what the answer should be! Warren Buffett has a good analogy for this with buying burgers from a supermarket. He's going to keep buying burgers, so rejoice when prices are a lot lower.

What shares will help your future self financially?

I don't think you can go too wrong with low-cost, quality exchange-traded funds (ETFs) like BetaShares Australia 200 ETF (ASX: A200), iShares S&P Global 100 (ASX: IOO) and iShares S&P 500 ETF (ASX: IVV).

I also believe there are some great fund managers to chose from. Shares like Magellan High Conviction Trust (ASX: MHH), MFF Capital Investments Ltd (ASX: MFF) and PM Capital Global Opportunities Fund Ltd (ASX: PGF) could be solid picks at these prices. Managers can be worth the fees if they outperform or you buy at a good discount to the assets. 

The post Save your future self from financial misery appeared first on The Motley Fool Australia.

There are a lot of people out there that have not been building up their retirement nest enough to be able to retire comfortably at 65, perhaps not even by 70.

I don't know every family tree out there. If you're a millennial who has parents who are about to retire in 2021 I'm not sure I can help. But the younger millennials – those born in the mid 1990s – have the potential to beat their parents to retirement if they work hard at it. I think ASX shares are key.

Why are ASX shares the answer?

I believe that most asset classes offer very little potential for long-term wealth growth. Cash and bonds offer very little return due to the RBA's ultra low interest rate.

I think capital city property could be permanently changed by the coronavirus crisis. More people may decide to rent than buy with cheaper rental prices (lowering demand for property buying). Immigration could be low for a long time. Interest rates can't really go any lower. People may want to avoid big cities and live in small regional areas.

ASX shares on the other hand are great for millennials to invest in. The purchase costs are very low (think how expensive stamp duty and other buying fees are). You can start with as little as $500, whereas you need a huge cash deposit for a property. Most of those property return calculations don't include the costs of purchasing. Think of other costs of negative gearing, the loss of money when the property is vacant and so on. These usually aren't included either.

Plenty of millennial parents may be invested in the wrong assets at the moment.

Which investments would be good ideas?

Not every ASX share investment is a good idea. Expensive and poor performing investment managers are drains on your potential wealth. Plenty of people just own mature, low-growth businesses like Commonwealth Bank of Australia (ASX: CBA), Telstra Corporation Ltd (ASX: TLS) and Woolworths Group Ltd (ASX: WOW). These probably won't do much over the 2020s. 

It's growth that will make the biggest difference. Individual ASX shares like A2 Milk Company Ltd (ASX: A2M), Pushpay Holdings Ltd (ASX: PPH), Brickworks Limited (ASX: BKW), Bubs Australia Ltd (ASX: BUB) and Altium Limited (ASX: ALU) are names that I think could be much bigger businesses in five years.

There are some listed fund managers that I think have a very good strategy. Does their style mean they're likely to produce strong returns over the long-term? Some ideas are: WAM Microcap Limited (ASX: WMI), MFF Capital Investments Ltd (ASX: MFF), Magellan Global Trust (ASX: MGG) and PM Capital Global Opportunities Fund Ltd (ASX: PGF).

Many millennials find the easiest way to invest in shares on the ASX is in low cost exchange-traded funds (ETFs). Some examples are: BetaShares Australia 200 ETF (ASX: A200), iShares S&P 500 ETF (ASX: IVV) and Vanguard MSCI Index International Shares ETF (ASX: VGS).

How fast could a millennial retire?

I'm not sure how much your finances would be able to invest. But let's say you make it a big goal in you're life and you're able to achieve returns of 10% a month with ASX shares. According to Moneysmart if you were aiming for $1 million in 20 years (to beat your parents) you'd have to invest around $1,325 a month. Obviously if you invested more, or made better returns, then you could return quicker.

I think that's entirely possible for two-adult household who diligently saved and invested each month.

The post ASX shares can help millennials retire before their parents appeared first on The Motley Fool Australia.

Coronavirus has caused a lot of human and economic pain. Share prices have seriously dropped off over the past couple of months.

Here are four ASX shares I'd buy with $10,000:

Pushpay Holdings Ltd (ASX: PPH) – $2,500

Pushpay is an electronic donation payment business. It's one of the few ASX shares to actually upgrade its earnings expectations during this tough time. As you can imagine, there are far less people going to churches in the US right now.

Being able to donate electronically as well as videostream the church service is a very attractive feature of Pushpay's service.

The company is already making profit and generating positive cashflow, so this period may just accelerate churches adopting Pushpay technology even quicker.

MFF Capital Investments Ltd (ASX: MFF) – $3,000

I think Chris Mackay is one of the best fund managers on the ASX. His management of listed investment company (LIC) MFF Capital has been very good over the past decade. ASX shares are good, but some of the best shares like Visa and Mastercard are listed overseas. 

MFF Capital had sold down some shares and paid a special dividend before the sell-off started in February 2020.

MFF Capital has recently increased its cash position. Net cash at the end of April 2020 was 38.3%, so it can now heavily protect against any more market declines. The substantial cash pile means it can buy any beaten-up opportunities in the future.

I expect over the next decade it will continue to be one of the top LIC performers as it continues to have much lower fees, that are fixed, compared to other listed vehicles that invest in overseas shares.

Brickworks Limited (ASX: BKW) – $2,500

I believe Brickworks is one of the most reliable ASX shares. It has been operating for many decades and has been through plenty of tough periods already. It hasn't decreased its dividend for over forty years. 

Brickworks has a solid balance sheet to help its building product divisions get through the next year which will see lower construction activity. But there are two other divisions that will help the company get through until life returns to normal.

Both the industrial property trust and investments division are expected to deliver reliable and growing earnings & cashflow to Brickworks over the long-term. They support Brickworks' market capitalisation as well as the dividend.

PM Capital Global Opportunities Fund Ltd (ASX: PGF) – $2,000

The LIC was a top performer in 2019 and has been a good performer since inception. This year has obviously been rough for almost every investor, but I believe it's very attractively priced to deliver solid long-term returns.

Today, PM Capital announced its net tangible assets (NTA) per share as at 1 May 2020, which was almost $1.10. This means the current share price of $0.89 is a 19% discount to the NTA. That's a big discount. 

It also offers a trailing grossed-up dividend yield of 6.4%.

Foolish takeaway

All four of these ASX shares are looking very attractively priced to me right now. I think Pushpay could be the best buy right now, but MFF Capital's cash balance offers a lot of downside protection which is why I allocated the most money to it.

The post Where I'd instantly invest $10,000 into ASX shares appeared first on The Motley Fool Australia.