If you’re thinking about getting started in the share market, there sure is a lot to get your head around. From deciphering all the jargon to deciding which shares out there are worthy of your first pick, turning up the investing path can be an overwhelming experience.
With all that in mind, here are two ASX shares that I think would be perfect for a beginner to build a starter portfolio around.
BetaShares Australia 200 ETF (ASX: A200)
A200 is an ETF (exchange traded fund) that simply holds shares in the 200 largest companies on the ASX. That means you’re getting all the blue-chips like Commonwealth Bank of Australia (ASX: CBA), Telstra Corporation Ltd (ASX: TLS), Woolworths Group Ltd (ASX: WOW) and Wesfarmers Ltd (ASX: WES) in one share.
I like A200 for a beginner’s share as it takes all of the pressure off actually choosing the stocks yourself – you’re essentially buying everything. And that means you’ll also get an ‘average’ market return over the long-run (which many investors struggle to do anyway). A200 has returned 12.76% p.a. since inception and also offers a trailing grossed-up distribution yield of 4.8%
MFF Capital Investments Ltd (ASX: MFF)
MFF Capital is a Listed Investment Company (LIC) which works in a similar way to an ETF like A200, but has a management team choosing stocks rather than just following the top 200. This company specialises in mostly US stocks, so by buying MFF shares, you are getting a basket of businesses that includes names like Visa, Mastercard, Alphabet (Google), Microsoft and Coca Cola.
These are some of the most famous names in the world, and that’s why I think MFF would make a great stock for a beginner. It’s normally fairly difficult to buy US shares yourself, but through MFF, you can get a healthy diversification in your portfolio through one easy ASX share. In my opinion, a beginner investor can’t go wrong with this company.
Foolish Takeaway
I think with these two ASX shares, you are getting two fantastic options for any potential investor just starting out on their journey. In my view, owning just these two shares will instantly give you a well-diversified portfolio that wouldn’t need too much attention or maintenance to deliver good returns.
