So, you’ve decided to start an ASX share portfolio. Well done on taking the plunge! I hope that you find share investing as interesting and rewarding as I do.
In this article, I’ll take you through 3 of my top share picks to get you started. Each of these companies operates in different sectors, providing you with market diversification.
Keep in mind, it’s always a good idea to expand your portfolio over time to ensure you have sufficient market diversification and not too much portfolio weighting in any one share. Try to build up your portfolio to have at least 10 shares over time.
CSL has had a great run on the Australian ASX over the past 2 decades. It is now the second-largest company on the ASX, with a market capitalisation of over $130 billion.
This ASX share has become a global market leader in blood plasma research and disease treatment. It has a strong global product reach spanning more than 60 countries. CSL is also playing a vital role during the coronavirus pandemic. This includes entering into a new agreement to accelerate the development of a COVID-19 vaccine candidate.
I am confident that CSL is well-positioned to continue to grow its revenue base strongly over the next decade. A strong new product development pipeline will drive this growth.
Macquarie Group Ltd (ASX: MQG)
Macquarie is a global financial services business with a focus on international investment banking. It is a true Australian success story, with a strong track record of profitability over the last few decades.
Macquarie has become a more balanced and diversified business rather than one heavily focused on a small core group of operations, over the past few years. This diversification is what really appeals to me over Australia’s big 4 banks – Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd. (ASX: NAB) and Australia and New Zealand Banking GrpLtd (ASX: ANZ).
I believe this ASX share is a great choice for both growth and income. It currently pays a forward dividend yield of 3.7%, partially franked.
My third ASX share pick to get you started in Transurban. It is one of the world’s largest toll-road operators. It is also the largest operator of private toll-roads in Australia.
In fact, Transurban has a virtual monopoly on the toll roads of Australia’s 2 largest cities; Sydney and Melbourne. In addition, it also has a number of toll roads in Brisbane and in North America.
Transurban has typically been viewed as a strong defensive share from the perspective that it is unlikely to be impacted by economic downturns. The coronavirus pandemic has, of course, been a once-in-century exception to this… Although hit hard during the early phase of the pandemic, Transurban reported a progressive recent recovery in traffic on its toll networks across Australia.
I believe that Transurban remains well-placed to capitalise on a growing population in both Australia and the USA over the next decade.
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Phil Harpur owns shares of CSL Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia owns shares of Transurban Group. 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.