Starting out on your investing journey can be an intimidating step to take. There’s nothing better than seeing a fat purse in the form of your savings account balance – it’s safe, available, earning (a little) interest and it’s yours. Risking this hard-earned cash in the share market might feel like the wrong thing to do at first – or even a step backwards. You might feel it’s gambling, or otherwise pursuing a risky venture that you really don’t understand that well.
But investing is absolutely a great way to spend your money, especially as bank interest rates don’t really get you anywhere at all these days. If done without too many mistakes, its very possible to get an average return of 5%, 7%, or even 10% or 12%.
So to get you started, here are 2 ASX shares that I think are perfect for beginners today.
Magellan Global Trust (ASX: MGG)
MGG shares aren’t really the same as buying a company like Commonwealth Bank of Australia (ASX: CBA). That’s because MGG is really a trust – managed by a professional team and holding a basket of other companies on your behalf. Right now, these include names like Starbucks, Apple, Alphabet and Mastercard.
I think MGG is perfect for beginners because the team at Magellan do all the hard work of buying and selling shares for you. You can just ‘set and forget’ whilst collecting the 4% cash distribution that the fund aims to dish out every year. Magellan Global Trust has returned an average of 16.85% per annum since its inception in 2017 – making this one of my top stock for beginners.
Argo Investments Limited (ASX: ARG)
Argo is a listed investment company (LIC) that works in a similar way to MGG – that is, it chooses and holds other shares on your behalf. This company is one of the oldest LICs on the ASX. It was founded all the way back in 1946, which I think demonstrates that it must be doing something right.
Unlike MGG, Argo only invests in Australian companies and its holdings include most of the biggest blue-chip shares on the ASX, as well as some smaller stocks. It also pays a solid 3.67% dividend yield (on current prices), which comes complete with full franking credits. Thus, for a more ‘homegrown’ dividend-focused investment that you can also ‘set and forget’, I think Argo is a great choice for beginners today.
Both Magellan Global Trust and Argo are great shares that any beginner can own with confidence, in my opinion. Both companies hold other shares, chosen by investing teams on your behalf, which takes most of the pressure off you as an investor. In my view, that kind of ‘hand-off’ approach makes these 2 companies perfect for a first investment.
The post 2 ASX shares perfect for beginners today appeared first on Motley Fool Australia.
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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2020