This week on The Bull, Andrew Wielandt of DP Wealth Advisory offers his recommendations as to which ones to buy.

Let's take a look.

Milford Australian Absolute Growth Complex ETF (ASX: MFOA)

The Milford Australian Absolute Growth Complex ETF is steady at $11.46 apiece today.

This ASX ETF invests in a diversified portfolio of predominantly ASX shares, as well as some international equities and cash. 

Wielandt explains his buy rating on this ASX ETF:

The fund aims to generate returns of 5 per cent above the Reserve Bank of Australia's cash rate.

The fund also aims to preserve capital in times of uncertainty.

Major holdings included BHP Group Ltd (ASX: BHP), National Australia Bank Ltd (ASX: NAB) and Westpac Banking Corp (ASX: WBC) shares.

This ETF proved its resilience during market volatility in March 2026.

The ETF has risen from $10.87 on June 12, 2025 to trade at $11.31 on June 11, 2026.

We like MFOA's outlook in volatile and stable times.

The RBA's cash rate is 4.35% after three increases already in 2026 due to resurgent inflation.

The RBA will announce its next interest rate call this afternoon at 2:30pm.

This ASX ETF's management fee is 0.9%.

Betashares FTSE Rafi Australia 200 ETF (ASX: QOZ)

The Betashares FTSE Rafi Australia 200 ETF is down 0.2% at $19.51 apiece on Tuesday.

Wielandt likes this ASX ETF because it considers the fundamental size or economic footprint of a business, rather than just its market capitalisation. As a result, it focuses more on value shares within the S&P/ASX 200 Index (ASX: XJO).

Betashares explains the strategy:

The index which QOZ aims to track provides exposure to a diversified portfolio of Australian equities, weighted in a way that is reflective of the economic importance rather than the market capitalisation of its constituents.

Constituent weighting is based on accounting values and is known as "Fundamental indexing".

Portfolio holdings included BHP shares, Commonwealth Bank of Australia (ASX: CBA), and Woodside Energy Group Ltd (ASX: WDS).

Wielandt also has a buy rating on this ASX ETF.

He comments:

The ETF has posted returns of 10.87 per cent per annum over the past five years and 19.12 per cent in the past year to May 29, 2026.

Consistent performance is appealing during volatile times.

The management fee is 0.4%.

The post 2 ASX ETFs to buy: expert appeared first on The Motley Fool Australia.

Shares in the S&P/ASX 200 Index (ASX: XJO) Aussie fuel supplier closed on Friday trading for $36.45. In early afternoon trade on Monday, shares are changing hands for $34.21 apiece, down 6.2%.

For some context the ASX 200 is up 1.3% while the S&P/ASX 200 Energy Index (ASX: XEJ) is down 5.3% at this same time.

While many ASX shares are rallying today, ASX energy stocks are broadly underperforming amid news that the US and Iran have agreed to a peace deal to end the Middle East conflict.

With oil tankers potentially beginning to move through the critical Strait of Hormuz again later this week, the Brent crude oil price is down 4.9% to US$83.06 per barrel. This sees the Brent crude oil price down 25% from the US$110.40 per barrel it was trading for a month ago.

Despite today's underperformance, Ampol shares remain up 32.7% over the past 12 months, racing ahead of the 4.4% one-year gains delivered by the benchmark index.

And that's not including Ampol's two fully franked dividends, totalling $1.00 a share, which eligible stockholders will have received over this period.

Ampol trades on a fully franked trailing dividend yield of 2.9%.

With this performance in mind, we return to our headline question.

Ampol shares: Buy, hold or sell?

DP Wealth Advisory's Andrew Wielandt ran his slide rule over the ASX 200 energy stock late last week, prior to the latest Middle East peace deal announcement.

"Ampol is Australia's biggest petrol and convenience network," he said (quoted by The Bull). "It also owns the Lytton oil refinery in Queensland."

Wielandt noted:

The Middle East crisis is positive for the company's refining margins and earnings growth is expected to continue moving forward. The convenience retail segment provides the benefit of diversification.

But taking into account the outsized gains already delivered by Ampol shares, Wielandt concluded, "A significantly increasing share price in the past 12 months reflects market optimism, so ALD remains a hold at these levels."

Consider this ASX ETF instead

Wielandt isn't ready to pull the buy trigger on Ampol shares at current levels.

But he sounded a bullish note on an exchange traded fund (ETF) that holds ASX giants like Woodside Energy Group Ltd (ASX: WDS), Commonwealth Bank of Australia (ASX: CBA), and BHP Group Ltd (ASX: BHP) shares.

Namely the BetaShares FTSE Rafi Australia 200 ETF (ASX: QOZ).

"This exchange traded fund offers a point of difference from many other ETFs," Wielandt said.

"It considers fundamental size or economic footprint of a business, rather than just its market capitalisation. Consequently, this ETF focuses more on value businesses," he added.

Summarising his buy recommendation on the ASX ETF, Wielandt concluded:

The ETF has posted returns of 10.87% per annum over the past five years and 19.12% in the past year to May 29, 2026. Consistent performance is appealing during volatile times.

The post Should I buy the dip on Ampol shares today? appeared first on The Motley Fool Australia.

Value investing is an investment philosophy built on the belief that markets are not always efficient in the short term. However they tend to recognise true worth over time.

Why chase value?

At its core, value investing involves identifying companies whose shares are trading below what they are actually worth based on their underlying financial performance, assets, and long-term earning potential. 

This "true worth" is known as intrinsic value.

Rather than chasing trends or momentum, value investors deliberately look for situations where the market has overreacted. This can drive a stock price down below what the business fundamentals justify. 

These mispricings are treated as opportunities rather than risks.

The strategy is then to hold these undervalued assets patiently, waiting for the gap between market price and intrinsic value to close. When that happens, the share price "corrects" upward, and the investor realises a gain.

In essence, value investing is less about predicting the next market move and more about buying solid businesses at discounted prices and allowing time for market perception to catch up with economic reality.

Why value investing is back 

There are several signs that suggest we may be in the early stages of a value-driven market environment.

Inflation could remain elevated due to geopolitical tensions and high global debt, with oil prices still significantly above levels from six months ago. Historically, rising commodity prices have often signalled sustained inflation.

At the same time, value equities look relatively attractive, trading near long-term averages and at multi-year lows versus broader global equities, suggesting room for upside if conditions continue to support value.

Three ASX ETFs to target value

With these factors pointing towards a value market, there are several ASX ETFs investors may choose to target. 

Firstly, the BetaShares Ftse Rafi Australia 200 ETF (ASX: QOZ). 

This fund tracks the ASX 200, however they are measured by fundamental size rather than market cap.

This helps tilt the fund toward cheaper Australian companies based on sales, cash flow, dividends, and book value. It could be a strong fit if you want Australian large-cap value exposure. 

Turning our attention to international options, another fund to consider is Vanguard Global Value Equity Active ETF (ASX: VVLU). 

This fund seeks to provide long term capital appreciation through an active management approach that invests in global equity securities demonstrating value characteristics.

Finally, investors could also consider the VanEck MSCI International Value ETF (ASX: VLUE). 

It offers a portfolio of 250 international developed market large and mid-cap companies, with high value scores. 

The post We're back in a value market: Here's 3 ASX ETFs to target appeared first on The Motley Fool Australia.

It includes the 200 largest companies in Australia weighted by market capitalisation. 

Many investors have a portion of their portfolio dedicated to an ASX ETF that tracks the performance of this index. 

However, many investors might not be aware of concentration risk. 

Concentration: the case against traditional funds 

Some investors may be unaware that the ASX 200 index is weighted towards just a couple of holdings and sectors because it is market capitalisation based.

A small number of very large companies – especially banks like Commonwealth Bank Of Australia (ASX: CBA) and miners like BHP Group (ASX: BHP) – make up a disproportionately large share of the index due to market-cap weighting. 

This means the performance of the "Australian market" is often driven more by a handful of companies than by the broader Australian economy.

A recent report from VanEck highlights this issue.

Investors buying a diversified Australian equity strategy would think it is unlikely that two stocks would be 22% of the portfolio, nor would they think two sectors represent over 50% of the portfolio. This is a risk: Concentration risk.

Nothing highlighted this more than the post-budget fall of CBA. Australia's 2nd largest company fell by over 10% on Wednesday.

So how do investors combat this? 

There are several ASX ETFs that use unique strategies to provide a more balanced profile of the ASX 200. 

Here are three options to consider. 

VanEck Australian Equal Weight ETF (ASX: MVW)

This ASX ETF includes only the largest and most liquid companies on ASX.

It currently includes 76 equally weighted stocks, that are rebalanced on a quarterly basis.

Due to the MVW Index's equal weight construction methodology, at the last rebalance, no company was more than 1.3%. Therefore, MVW, which tracks this index has less stock concentration risk than the ASX 200.

BetaShares Ftse Rafi Australia 200 ETF (ASX: QOZ)

QOZ ETF is another option to target the ASX 200.

It tracks the performance an index that comprises the top 200 companies listed on the ASX. However they are measured by fundamental size.

QOZ is weighted in a way that is reflective of the economic importance rather than the market capitalisation of its constituents.

Constituent weighting is based on accounting values and is known as "Fundamental indexing".

BetaShares Australian Ex-20 Portfolio Diversifier ETF (ASX: EX20)

Many portfolios having a heavy bias towards the big banks and miners. However, EX20 helps diversify exposure away from those stocks and sectors.

It aims to track the performance of an index comprising the 180 largest stocks listed on the ASX, after excluding the 20 largest, based on their market capitalisation.

The post Three unique ASX ETFs to target the ASX 200  appeared first on The Motley Fool Australia.

Investing in an ETF tracking the S&P/ASX 200 Index (ASX: XJO) can be a 'set and forget' opportunity with diversification.

But not all ETFs are created equal — literally. There are multiple ETFs that track the performance of the ASX 200 in different ways. Digging a little deeper to understand what you're buying is important.

Traditional "market cap" ETFs

Many ETFs use market capitalisation to weigh their holdings.

For example, the iShares Core S&P/ASX 200 ETF (ASX: IOZ) is designed to measure the performance of the 200 largest Australian securities listed on the ASX. 

This fund measures the "largest securities" by float-adjusted market capitalisation.

"Float-adjusted" capitalisation attempts to more accurately measure a company's market value compared to market cap. It only considers the shares available for public trading rather than all outstanding shares.

So, how does this shake out in terms of its holdings?

iShares Core ASX 200 top 10 holdings

Commonwealth Bank of Australia (ASX: CBA): 10.53%
BHP Group Ltd (ASX: BHP): 8.16%
CSL Ltd (ASX: CSL): 5.41%
National Australia Bank Ltd (ASX: NAB): 4.78%
Westpac Banking Corporation (ASX: WBC): 4.58%
ANZ Group Holdings Ltd (ASX: ANZ): 3.71%
Macquarie Group Ltd (ASX: MQG): 3.25%
Wesfarmers Ltd (ASX: WES): 3.23%
Goodman Group (ASX: GMG): 2.63%
Woodside Energy Group Ltd (ASX: WDS): 1.85%

These top 10 holdings and their weighting are almost identical for similar ETFs, such as the BetaShares Australia 200 ETF (ASX: A200) and the Vanguard Australian Shares Index ETF (ASX: VAS), which tracks the ASX300. 

Over the last 10 years, the iShares Core ASX 200 ETF has delivered an average return per annum of 8.9%.

BetaShares FTSE RAFI Australia 200 ETF (ASX: QOZ)

However, I am more bullish on another ETF that tracks the ASX 200: the BetaShares FTSE RAFI Australia 200 ETF (ASX:QOZ). This fund uses a different weighting strategy than market cap. 

The ETF aims to provide exposure to a diversified portfolio of Australian equities, weighted to reflect economic importance rather than market capitalisation.

When looking at its holdings, you can see it has a different breakdown compared to similar ETFs like the iShares, BetaShares, and Vanguard market cap-weighted variants.

BetaShares FTSE RAFI Australia 200 top 10 holdings

BHP Group Ltd: 10.8%
Commonwealth Bank of Australia: 9.1%
Westpac Banking Corp: 6.8%
National Australia Bank Ltd: 5.5%
ANZ Group Holdings Ltd: 5.0%
Macquarie Group Ltd: 3.1%
Rio Tinto Ltd (ASX: RIO): 2.9%
Wesfarmers Ltd: 2.6%
Woodside Energy Group Ltd: 2.3%
Woolworths Group Ltd (ASX: WOW): 2.2%

Most importantly, the BetaShares FTSE RAFI Australia 200 ETF has outperformed the three market cap-weighted options on a per-annum basis over the last ten years. 

Since its inception in July 2013, the 'fundamentally weighted' ETF has delivered an average annual return of 9.40%, slightly ahead of ASX200 tracking ETFs that weight their portfolios based on market cap. 

According to the fund, this is its specific goal. It aims to deliver outperformance compared to products based on market-cap-weighted indices by selling expensive shares while buying undervalued ones.

By removing the link between a company's size and its weight in the index, the BetaShares RAFI Australia ETF strategy is expected to be less affected by fads and bubbles. 

For investors looking for an ASX 200 index-tracking ETF with a point of difference and strong returns, the lesser-known ETF has shown it can outperform some of the larger market-cap-weighted funds.

It's important to note that the BetaShares FTSE RAFI Australia 200 ETF has higher fees of 0.40% p.a compared to the more traditionally weighted ETFs.

The post Not all ETFs are created equal. Why I'd buy this ASX 200 ETF for growth appeared first on The Motley Fool Australia.

This even includes funds that are designed to generate passive income.

This is good news for income investors that don't have time to research the market and just want an easy way to invest.

But which ASX ETFs could be good options for them? Let's take a look at three options they have. Here's what you need to know about them:

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The first ASX ETF that could generate passive income is the Vanguard Australian Shares High Yield ETF.

This fund is filled with many of the biggest forecast dividend yields available to investors on the Australian share market, based on broker research.

It is important to note that the fund doesn't just buy banks and miners, which traditionally provide the biggest yields. It has diversity in mind and ensures that its 65 holdings come from all corners of the market.

This includes miners and banks such as BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA), but also companies like intellectual property services company IPH Ltd (ASX: IPH), toll road operator Transurban Group (ASX: TCL) and retail giant Harvey Norman Holdings Limited (ASX: HVN).

The Vanguard Australian Shares High Yield ETF currently trades with a trailing dividend yield of 5%.

Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX)

Another ASX ETF that could be a great option for income investors is the Betashares Australian Top 20 Equity Yield Maximiser Fund.

It aims to produce attractive quarterly income and reduce the volatility of portfolio returns through a covered call strategy over a portfolio of the 20 largest blue chip shares listed on the Australian share market.

Betashares notes that call options are actively managed and are written with terms of one to three months and strike prices that are expected to be approximately 3% to 7% above the then current market prices of the securities. By writing these call options, YMAX receives option premiums which are expected to provide an additional source of income for YMAX and a partial hedge against a decline in the value of the share.

Betashares has recommended the ASX ETF as one to buy to counter falling dividend yields. It notes that it "performs well in a neutral or gradually rising market." At present, it trades with a trailing dividend yield of 6.3%.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A third ASX ETF to look at for passive income is the FTSE RAFI Australia 200 ETF.

BetaShares also recently recommended this ETF one to buy to counter falling dividend yields. It notes that it uses a fundamental indexing strategy which is designed to screen for stocks based on their merits rather than market capitalisation.

It then ranks and invests in these companies accordingly. The end result is investors holding stocks that have healthier balance sheets and a greater capacity to pay dividends.

The Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.4%.

The post Buy these quality ASX ETFs for a passive income boost appeared first on The Motley Fool Australia.

Instead of having to pick individual stocks to buy, ETFs allow investors to snap up large groups of income shares in one easy investment.

This can provide near instant diversification for a portfolio, reducing risk and removing the stress of deciding which shares to buy.

But which ASX ETFs would be good for income? Three quality options to consider buying are listed below:

BetaShares S&P 500 Yield Maximiser (ASX: UMAX)

The first ASX ETF for income investors to look at buying is the BetaShares S&P 500 Yield Maximiser.

It is an actively managed fund that provides investors with access to the top 500 companies listed on Wall Street's S&P 500 index. It uses a covered call strategy to target quarterly income that is significantly greater than the dividend yield of the underlying share portfolio.

For example, thanks to the clever way that this strategy works, its units currently trade with an attractive 4.5% distribution yield. This is far greater than the average yield on the S&P 500 index at present.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A second ASX ETF to look at for passive income is the Betashares FTSE RAFI Australia 200 ETF. It was recently recommended by BetaShares as a way to counter falling dividend yields.

This ETF uses a fundamental indexing strategy designed to screen stocks based on their merits rather than their market capitalisation. It judges ASX shares on their sales, cash flow, dividends, and book value. After which, it ranks these stocks and invests in them accordingly.

BetaShares points out that this strategy ultimately leads to investors holding stocks that have healthier balance sheets and a greater capacity to pay dividends. At present, the Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.6%.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

A third and final ASX ETF for passive income investors to look at is the Vanguard Australian Shares High Yield ETF.

This popular ETF offers investors low-cost exposure to a group of 70+ ASX shares that analysts are forecasting to have larger than average dividend yields. This includes all the well-known big dividend payers such as BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), as well as smaller names.

The Vanguard Australian Shares Index ETF currently trades with a trailing dividend yield of 5%.

The post Buy these top ASX ETFs for easy passive income in 2025 appeared first on The Motley Fool Australia.

That's because there are exchange-traded funds (ETFs) out there that offer income investors the ability to buy large groups of dividend shares with a single click of the button. This can make building a passive income portfolio much easier.

But which ASX income ETFs could be good options for investors in 2025? Let's take a look at three:

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The first ASX income ETF that could be a top option for investors is the Vanguard Australian Shares High Yield ETF.

Vanguard notes that this fund seeks to track the return of the FTSE Australia High Dividend Yield Index before taking into account fees, expenses and tax. It provides low-cost exposure to ASX shares that have higher forecast dividends relative to other ASX-listed companies.

The fund manager notes that security diversification is achieved by restricting the proportion invested in any one industry to 40% of the total ETF and 10% for any one company. This means it is less exposed to the performance fluctuations of individual securities.

At present, the ETF has 65 holdings. This includes companies such as ANZ Group Holdings Ltd (ASX: ANZ), BHP Group Ltd ASX: BHP), National Australia Bank Ltd (ASX: NAB), Telstra Group Ltd (ASX: TLS), and Wesfarmers Ltd (ASX: WES).

The Vanguard Australian Shares High Yield ETF has a trailing dividend yield of 5%.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A second ASX income ETF for investors to consider for 2025 is the FTSE RAFI Australia 200 ETF.

BetaShares recently named this ETF as one to buy to counter falling dividend yields. The fund manager highlights that it uses a fundamental indexing strategy which is designed to screen for stocks based on their merits rather than market capitalisation.

It screens for sales, cash flow, dividends, and book value, then ranks and invests in these companies accordingly. This means that investors are left holding a group of stocks with healthier balance sheets and a greater capacity to pay dividends.

The Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.6%.

BetaShares S&P 500 Yield Maximiser (ASX: UMAX)

A third and final ASX income ETF to look at for next year is the BetaShares S&P 500 Yield Maximiser.

This fund gives investors access to the top 500 companies listed on Wall Street. This includes many of the largest companies in the world such as Apple (NASDAQ: AAPL), Exxon Mobil (NYSE: XOM), and Walmart (NYSE: WMT).

BetaShares points out that UMAX aims to generate attractive quarterly income and reduce the volatility of portfolio returns by implementing an equity income investment strategy. This strategy means it has been able to provide investors with significantly better dividend yields than you would get by just investing in the 500 companies individually.

For example, its units currently trade with a trailing 4.5% distribution yield.

The post Buy these ASX ETFs for passive income in 2025 appeared first on The Motley Fool Australia.

That's because there are exchange-traded funds (ETFs) out there that could potentially help you achieve this goal.

For example, the ASX ETFs named below offer investors exposure to a large collection of dividend-paying stocks in one fell swoop. This can provide a decent level of diversification for a portfolio.

Here's what you need to know about these income ETFs:

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

The FTSE RAFI Australia 200 ETF could be an income ETF to consider buying. It was recently recommended as an option by BetaShares to counter falling dividend yields.

This fund uses a fundamental indexing strategy designed to screen stocks based on their merits rather than market capitalisation. It screens ASX shares using sales, cash flow, dividends, and book value. After which, it ranks these stocks and invests in them accordingly.

The fund manager notes that this strategy means that investors ultimately end up holding stocks that have healthier balance sheets and a greater capacity to pay dividends. At present, the Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.5%.

Vanguard Australian Shares Index ETF (ASX: VHY)

Another ASX ETF that could be a top option for income investors this month is the Vanguard Australian Shares High Yield ETF.

This popular fund provides investors with low-cost exposure to a portfolio of ~70 ASX stocks that brokers are forecasting to have higher dividend yields relative to the market average.

Positively, Vanguard notes that security diversification is achieved by restricting the proportion invested in any one industry to 40% of the total ETF and 10% for any one company. In addition, Australian Real Estate Investment Trusts (A-REITS) are excluded from it, so there's no real direct exposure to the property market.

As a result, you will be left owning a portfolio of generous dividend-paying stocks such as BHP Group (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), and and Transurban Group (ASX: TCL).

The ETF currently trades with a trailing dividend yield of 4.9%.

BetaShares S&P 500 Yield Maximiser (ASX: UMAX)

A final ASX ETF for income investors to consider buying in November is the BetaShares S&P 500 Yield Maximiser.

This actively managed fund provides investors with access to the top 500 companies listed on Wall Street.

However, through a covered call strategy it is able to target quarterly income that is significantly greater than the dividend yield you would expect to receive from the underlying share portfolio.

This means, for example, at present it trades with a trailing 4.6% distribution yield.

The post Buy these excellent ASX income ETFs in November appeared first on The Motley Fool Australia.

While this is disappointing for some income investors, all is not lost. That's because there are ASX shares and exchange-traded funds (ETFs) out there to save the day.

With respect to the latter, let's take a look at three ASX ETFs that could be quality options for investors looking for a source of income. Here's what you need to know about these funds:

Vanguard Australian Shares Index ETF (ASX: VHY)

The first ASX ETF for income investors to look at is the Vanguard Australian Shares High Yield ETF.

Rather than buying individual dividend stocks, this ETF lets you buy a large group of them in one fell swoop.

At present, the fund is home to 65 ASX dividend shares that are forecast to have bigger dividend yields relative to the market average. But this doesn't mean you will end up owning just miners and banks. Vanguard restricts the proportion invested in any one industry to 40% and 10% for any one company.

Its holdings include BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), Super Retail Group Ltd (ASX: SUL), and Transurban Group (ASX: TCL).

The Vanguard Australian Shares Index ETF currently trades with a trailing dividend yield of 4.9%.

BetaShares S&P 500 Yield Maximiser (ASX: UMAX)

Another ASX ETF to buy when interest rates fall is the BetaShares S&P 500 Yield Maximiser.

It is an actively managed fund that provides investors with access to the top 500 companies listed on Wall Street. This includes giants such as Apple and Walmart.

However, it operates in a very different way compared to a standard ETF. It uses a covered call strategy to target quarterly income that is significantly greater than the dividend yield of the underlying share portfolio over the medium term.

This means that, at present, its units offer investors a trailing 4.6% distribution yield.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A final ASX ETF to combat falling interest rates is the FTSE RAFI Australia 200 ETF.

This fund, recently recommended by BetaShares, uses a fundamental indexing strategy designed to screen stocks based on their merits rather than market capitalisation.

It screens ASX shares using sales, cash flow, dividends, and book value. After which, it ranks these stocks and invests in them accordingly. This strategy means that investors ultimately end up holding stocks that have healthier balance sheets and a greater capacity to pay dividends.

The Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.5%.

The post Buy these ASX income ETFs to beat falling interest rates appeared first on The Motley Fool Australia.

But which ones could be good options in October? Let's take a look at three that could be worth considering this month. They are as follows:

BetaShares S&P 500 Yield Maximiser (ASX: UMAX)

The first ASX ETF to look at is the BetaShares S&P 500 Yield Maximiser.

It has been created to give investors access to the top 500 companies listed on Wall Street. This includes many of the largest companies in the world such as Apple (NASDAQ: AAPL), Exxon Mobil (NYSE: XOM), Johnson & Johnson (NYSE: JNJ), and Walmart (NYSE: WMT).

BetaShares notes the UMAX aims to generate attractive quarterly income and reduce the volatility of portfolio returns by implementing an equity income investment strategy over this portfolio of stocks. It does not aim to track an index. This strategy means it has been able to provide investors with significantly better dividend yields than you would get by just investing in the 500 companies individually.

For example, its units currently trade with a trailing 4.6% distribution yield.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A second ASX ETF to look at is the FTSE RAFI Australia 200 ETF.

BetaShares recently recommended this ETF as a buy to counter falling dividend yields. It notes that it uses a fundamental indexing strategy which is designed to screen for stocks based on their merits rather than market capitalisation.

The ETF screens ASX companies using sales, cash flow, dividends, and book value. It then ranks and invests in these companies accordingly. This means that investors end up holding stocks that have healthier balance sheets and a greater capacity to pay dividends.

The Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.7%.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

Finally, the Vanguard Australian Shares High Yield ETF could be another good option for income investors.

This popular fund gives investors access to a group of 60+ ASX dividend shares that brokers are forecasting to provide larger than average dividend yields.

At present, this means you will find companies such as ANZ Group Holdings Ltd (ASX: ANZ), BHP Group Ltd ASX: BHP), National Australia Bank Ltd (ASX: NAB), Telstra Group Ltd (ASX: TLS), and Wesfarmers Ltd (ASX: WES) included in the fund.

The Vanguard Australian Shares High Yield ETF currently trades with a trailing dividend yield of 4.85%.

The post 3 ASX ETFs to buy for income in October appeared first on The Motley Fool Australia.

They provide income investors with the opportunity to generate income from a large group of dividend-paying shares. Here's what you need to know about them:

Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX)

The Betashares Australian Top 20 Equity Yield Maximiser Fund could be a great option for income investors.

This fund aims to produce attractive quarterly income and reduce the volatility of portfolio returns through a clever covered call strategy over a portfolio of the 20 largest blue chip shares listed on the local share market.

Betashares has recommended the ASX ETF as one to buy to counter falling dividend yields. It notes that it "performs well in a neutral or gradually rising market." At present, it trades with a trailing 12-month dividend yield of 7.6%.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A second ASX ETF for income investors to look at is the FTSE RAFI Australia 200 ETF.

It is another fund that is being recommended by analysts at BetaShares. The FTSE RAFI Australia 200 ETF uses a fundamental indexing strategy which is designed to screen for stocks based on their merits rather than market capitalisation.

BetaShares notes that instead of size, the ETF screens ASX shares using metrics such as sales, cash flow, dividends, and book value. It then ranks these shares and invests in the companies accordingly.

As a result, this means that investors end up holding stocks that have healthier balance sheets, which have a greater capacity to pay dividends.

At present, the Betashares FTSE RAFI Australia 200 ETF trades with a trailing dividend yield of 4.7%.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

A third and final ASX ETF for income investors is the Vanguard Australian Shares High Yield ETF.

This is a more traditional fund. It loads up a portfolio of many of the biggest forecast dividend yields available to investors on the Australian share market, based on broker estimates.

Importantly, the fund doesn't just buy banks and miners. It has diversity in mind and its holdings come from all corners of the market. This includes miner and banks such as BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA), but also companies like Transurban Group (ASX: TCL) and Lottery Corporation Ltd (ASX: TLC).

The Vanguard Australian Shares High Yield ETF currently trades with a dividend yield of 4.85%.

The post Buy these 3 ASX ETFs for an income boost appeared first on The Motley Fool Australia.

ETFs allow investors to buy large groups of shares from all corners of the world with a single click of the button. Previously, you would have to jump through hoops to invest internationally, and some markets were near impossible to gain access to.

Another positive is that ASX ETFs provide investors with easy access to groups of companies that fit a particular investment theme. This could be growth, value, mining or income, for example.

In this article we're going to focus on a couple of funds that offer investors the opportunity to generate passive income from the share market.

One uses a clever covered call strategy to generate income, whereas the other uses a fundamental indexing strategy. Here's what you need to know about these funds:

Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX)

The first ASX ETF that could be a top option for passive income investors is the Betashares Australian Top 20 Equity Yield Maximiser Fund.

It aims to generate attractive quarterly income and reduce the volatility of portfolio returns through the use of a covered call strategy over a portfolio of the 20 largest blue-chip shares listed on the Australian share market. A covered call is an options trading strategy that allows an investor to profit from expected price rises.

Betashares, which recently recommended this ETF, notes that the Betashares Australian Top 20 Equity Yield Maximiser Fund's covered call strategy "performs well in a neutral or gradually rising market."

At present, the ASX ETF was trading with a trailing 12-month dividend yield of 7.6%.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A second ASX ETF for passive income investors to consider is the FTSE RAFI Australia 200 ETF.

This fund, which is also being recommended by BetaShares, uses a fundamental indexing strategy which is designed to screen for stocks based on their merits rather than market capitalisation.

BetaShares notes that instead of size, the ETF screens ASX companies using sales, cash flow, dividends, and book value. It then ranks and invests in these companies accordingly.

This means that investors end up holding stocks that have healthier balance sheets, which have a greater capacity to pay dividends.

The Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.7%.

The post Buy these ASX ETFs for passive income appeared first on The Motley Fool Australia.

As well as having a plethora of ASX dividend shares to choose from, there are also plenty of exchange traded funds (ETFs) out there that could be suitable for income investors.

Especially those that don't enjoy picking stocks and would rather buy a collection of dividend-paying stocks in one fell swoop. Let's look at three top options for passive income:

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The first ASX ETF that could be a top option for income investors is the Vanguard Australian Shares High Yield ETF. It gives investors access to a group of 66 ASX dividend shares that brokers are forecasting to provide larger than average dividend yields.

But don't worry, this doesn't mean that you will be buying just banks and miners. The fund restricts how much it invests in any one company or industry for diversification purposes.

At present, you will find companies such as ANZ Group Holdings Ltd (ASX: ANZ), National Australia Bank Ltd (ASX: NAB), Telstra Group Ltd (ASX: TLS), and Wesfarmers Ltd (ASX: WES) included in the fund.

The Vanguard Australian Shares High Yield ETF currently trades with a trailing dividend yield of 4.8%.

Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX)

Another ASX ETF that could be a great option for income investors is the Betashares Australian Top 20 Equity Yield Maximiser Fund. This fund aims to generate attractive quarterly income and reduce the volatility of portfolio returns.

This is through a covered call strategy over a portfolio of the 20 largest blue-chip shares listed on the Australian share market.

The team at Betashares recently recommended the ETF as a top option to counter falling dividend yields, noting that the covered call strategy "performs well in a neutral or gradually rising market."

At present, the Betashares Australian Top 20 Equity Yield Maximiser Fund trades with a trailing 12-month dividend yield of 7.6%.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

A final ASX ETF that could be a top option for income investors (and is being recommended by BetaShares) is the FTSE RAFI Australia 200 ETF.

It uses a fundamental indexing strategy which is designed to screen for stocks based on their merits rather than market capitalisation. Instead of size, the ETF screens ASX companies using sales, cash flow, dividends, and book value. It then ranks and invests in companies accordingly.

This leaves investors holding stocks that have healthier balance sheets, which have a greater capacity to pay dividends.

The Betashares FTSE RAFI Australia 200 ETF currently has a trailing dividend yield of 4.7%.

The post Buy these top ASX ETFs for passive income appeared first on The Motley Fool Australia.

They can also be a powerful tool to build a passive income stream. This is achieved by providing investors with access to large groups of dividend shares or through clever income generation strategies.

But which ASX ETFs should income investors look at? Let's take a look at three options that could be worth considering:

Betashares Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX)

The Betashares Australian Top 20 Equity Yield Maximiser Fund could be a great option for income investors. It aims to generate quarterly income by implementing an equity income investment strategy over a portfolio of the 20 largest blue-chip shares listed on the Australian share market. Betashares recently recommended the ETF as an option to counter falling dividend yields. It said: "Betashares' range of Yield Maximiser funds use a covered call strategy to offer additional income over and above dividends generated by the portfolio. This approach takes a two-pronged strategy: earning dividends from the underlying stocks and generating income from writing call options on those shares."

At present, it trades with a trailing 12-month dividend yield of 7.6%.

Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)

Another ASX ETF that Betashares is recommending for income investors is the FTSE RAFI Australia 200 ETF. It employs a fundamental indexing strategy which is designed to screen for and own stocks based on their merits rather than market capitalisation. Instead of size, the ETF screens ASX companies using sales, cash flow, dividends, and book value. It then ranks and invests in companies accordingly. This essentially means that the fund has a portfolio of ASX shares with healthier balance sheets, which have a greater capacity to pay dividends while avoiding those who are reducing or not making payouts.

The Betashares FTSE RAFI Australia 200 ETF currently has a trailing dividend yield of 4.7%.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

A final ASX ETF for income investors to consider buying is the Vanguard Australian Shares High Yield ETF. This fund gives investors access to a group of ASX dividend shares that brokers are forecasting to provide big dividend yields. But it does this with diversification in mind, restricting how much it invests in any one company or industry. At present, you will find companies such as BHP Group Ltd (ASX: BHP), Coles Group Ltd (ASX: COL), Commonwealth Bank of Australia (ASX: CBA), and Wesfarmers Ltd (ASX: WES) among its holdings.

The Vanguard Australian Shares High Yield ETF currently trades with a trailing dividend yield of 4.8%.

The post 3 ASX ETFs to buy for passive income appeared first on The Motley Fool Australia.

It involves buying into a fund that merely mirrors a particular index — say the S&P/ASX 200 Index (ASX: XJO), the NASDAQ-100 (NASDAQ: NDX). The Vanguard Australian Shares Index ETF (ASX:VAS), which tracks the S&P/ASX 300 Index (ASX: XKO), is an example of a passive investment vehicle.

The buying and selling of individual shares doesn't require any human insight, so the fees are usually much lower than actively managed funds.

This 'warts and all' approach, according to Betashares director Craig Higson, is fine if you believe the market is completely efficient.

"However, if an investor is seeking to profit from possible mispricings in the market, the question then arises: Is there a manager or process that can potentially identify such mispricings, and offer the possibility of broad market outperformance?"

The answer is fundamental indexing.

Why is market capitalisation the criteria for indices?

Most major indices around the globe allow stocks to be included or excluded based on the size of their market capitalisation.

But isn't it arbitrary that out of all the metrics, this was chosen as the be-all and the end-all?

A US firm, Research Affiliates, certainly thought so. According to Higson, in 2002 it created a new way of indexing.

"This was at a time not long after the [dot-com] tech bubble, when many stocks in traditional indices were trading at clearly inflated values, and investors suffered accordingly as these stocks reversed to reflect their true or 'fundamental' value," he said.

"Out of RA's research, fundamental indexing was born."

Breaking the link between index criteria and share price

Fundamental indexing's major idea is to not have the share price influence the company's worthiness to be included in an index.

That way, it's purely the business' performance that leads to its inclusion.

"We know market bubbles and sell-offs occur, quite violently at times, and a share price may not always reflect true value," said Higson.

So the Research Associates Fundamental Indexing (RAFI) uses a formula that takes into account sales, cash flow, book value and dividends to qualify or disqualify a stock from inclusion.

Higson said that this allowed an index to embrace "bargain" shares.

"The fundamental-indexing strategy seeks to overweight relatively cheap stocks — such as those trading at price-to-book and price-to-earnings valuations below their respective long-run averages — while underweighting relatively expensive stocks."

Does fundamental indexing actually work?

While Higson was explaining fundamental indexing to sell his company's ETF product Betashares FTSE Rafi Australia 200 ETF (ASX: QOZ), he did present some evidence about the effectiveness of this approach.

He showed the annual returns for FTSE RAFI Australia 200 Index (FTSE: FRAU200) compared to the ASX 200 for the past 27 years.

"RAFI methodology has, on average, added around 1.8% per annum over and above the returns from the S&P/ASX 200 Index," Higson said.

"The strategy doesn't outperform every year, but over time has shown a consistent value-add."

Therefore, Higson argued, this approach still provides automatic stock selection like passive investing — but pursues outperformance like an active manager.

"In many ways, the RAFI approach has delivered on the often-unfulfilled promise of active management, with the cost efficiencies of passive investing."

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