As most ASX income investors would know, it's the norm here on the ASX for dividend shares to give investors a dividend paycheque every six months. Most ASX shares, including the vast majority of the blue chips that most investors would be familiar with, fit this mould.

That's everything from the big four banks and BHP Group Ltd (ASX: BHP) to Telstra Group Ltd (ASX: TLS), Woolworths Group Ltd (ASX: WOW) and CSL Limited (ASX: CSL).

This is actually quite unusual compared to other economies. In both the United States and the United Kingdom, quarterly dividend payments are the norm.

This situation that faces ASX investors makes using dividend shares as a source of passive income rather tricky. It can be hard to budget if you finally get to retire off of dividend income, but you only get paid twice a year.

So are there any alternatives to this six-month paycheque schedule?

How to secure monthly dividends on the ASX

Well, investors can always choose a variety of ASX shares. Not all dividend shares pay out their dividends in the same month. For example, Commonwealth Bank Of Australia (ASX: CBA) typically pays out its bi-annual dividends in March and September.

But Woolworths often forks out its shareholder cash in April and October, while Westpac Banking Corp (ASX: WBC) typically schedules its dividends for June and December. 

So you can pick a wide basket of ASX 200 blue chip dividend shares, and get something of a spread in dividend payments.

But otherwise, investors can utilise exchange-traded funds (ETFs) if they desire more frequent cash flow. Most ASX-based ETFs, such as the Vanguard Australian Shares Index ETF (ASX: VAS), will usually pay out quarterly distributions. As do funds covering overseas markets like the iShares S&P 500 ETF (ASX: IVV). These normally occur in January, April, July and October.

So using a mixture of ASX dividend shares and ETFs will get you even more frequent payments.

The final option for those desperate for a monthly paycheque is to find a company, ETF, listed investment company (LIC) or managed fund that pays out dividends every month.

These are rare, but they are out there. One example is the Plato Income Maximiser Fund (ASX: PL8). This LIC prioritises consistently funding monthly dividend paycheques to its investors. These typically come fully franked as well.

Another monthly dividend-payer is the BetaShares Australian Dividend Harvester Fund (ASX: HVST). This ETF also pays out monthly dividend distributions but uses derivatives to boost its come payments as well.

So if you do wish to secure monthly dividend paycheques from your ASX shares, there are a few ways to go about it.

The post Here's how I would secure monthly dividends in the 2024 financial year with these ASX stocks appeared first on The Motley Fool Australia.

The S&P 500 Index (INDEXSP: .INX) could be on track to deliver an impressive rally over the next two months, according to experts.

After rising by around 10% since the start of the year to 2 February 2023, it then dropped over 5% to 1 March 2023.

But, experts believe that the US share market is poised to perform well in the coming months. This could be good news for the global share market and the ASX share market because of how influential investor sentiment in the US can be on the world of the world's share markets.

Why the positivity?

The Australian Financial Review quoted Stifel's chief equity strategist Barry Bannister's thoughts on the situation:

The bearish chorus of Wall Street strategists continues to fight the S&P 500 rally since the intraday low (3491.58) on October 13 with those strategists flip-flopping from calling an imminent recession (caused by the Federal Reserve) to no recession (so, the Fed must cause one).

They can call it a bear market rally, a bear trap or call it a banana…we are not ignoring potential six-month 10-15 per cent rallies.

After May this [S&P 500] rally may be mostly over.

According to the AFR's reporting, Stifel thinks that the US Federal Reserve will stop increasing interest rates in June when it hits 5.25%. This could lead to business earnings hurting in the second and the possibility of a recession increasing in September as the labour market's strength "wanes".

Another expert, Fundstrat Global's Tom Lee, thinks that the S&P 500 is going to rise for the next eight weeks.

While Lee acknowledged uncertainty after a strong performance by the S&P 500 since October 2022, he suggested that the S&P 500 could reach around 4,250 by the end of April. That would represent an increase of around 5%. Lee said:

This is a scenario that many investors are hesitant to embrace (more likely sceptical) because of the understandable lack of clarity on inflation trajectory, Fed policy path, earnings risk and general heightened concerns about recession.

And as usually is the case, when there is uncertainty, investors lean negative—meaning, the conditions confirm investors leaning bearish or outright bearish

S&P 500 snapshot

For investors wanting to own a piece of the S&P 500, there's an investment option called the iShares S&P 500 ETF (ASX: IVV). Over the past five years, it has risen by around 70%, though past performance is not a reliable indicator of future performance.

The post S&P 500 could rally for next 8 weeks: Wall Street analysts appeared first on The Motley Fool Australia.

When starting out on what is hopefully a lifelong investing journey of building wealth, there are two paths one can go down. The first is to become an active share investor. This path involves researching individual businesses listed on the ASX, finding the best ones, and paying the right price for a piece of them.

This is typically what most people think of when 'investing in shares' is mentioned.

The second path is passively investing into index funds. An index fund is a managed fund or exchange-traded fund (ETF) that invests in an index. This index represents a broad swathe of the most successful companies listed on a share market.

For example, the flagship index that covers the Australian share market is the S&P/ASX 200 Index (ASX: XJO). The ASX 200 represents the largest 200 shares on the ASX, weighted by the companies' size (or market capitalisation).

The most popular index in the world is the United States' S&P 500 Index. This does a similar thing but covers the 500 largest shares listed on America's stock exchanges.

An index fund is designed to give investors the market return', no more, no less. The whole reason why many investors choose to shun passive investing and go down the active route is to try and beat the returns of the broader market.

But history shows this is easier said than done. That's why many other investors try a hybrid approach, investing in individual shares as well as in index funds.

Warren Buffett's favourite index fund

So time now to glean some advice from the great Warren Buffett — one of the best investors to have ever walked the earth. Buffett has made a career out of successfully beating the market.

As our chief investment officer Scott Phillips went through earlier this week, Buffett has vastly overachieved when it comes to this goal, delivering an average return of almost twice what the S&P 500 has given over a 58-year period.

Yet Buffett has some interesting advice on which path the average investor should go down. This is an excerpt from Buffett's 2013 letter to the shareholders of his company Berkshire Hathaway:

Most investors, of course, have not made the study of business prospects a priority in their lives. If wise, they will conclude that they do not know enough about specific businesses to predict their future earning power.

I have good news for these non-professionals: The typical investor doesn't need this skill. In aggregate, American business has done wonderfully over time and will continue to do so (though, most assuredly, in unpredictable fits and starts)….

The goal of the non-professional should not be to pick winners… but should rather be to own a cross-section of businesses that in aggregate are bound to do well. A low-cost S&P 500 index fund will achieve this goal…

Indeed, the unsophisticated investor who is realistic about his shortcomings is likely to obtain better long-term results than the knowledgeable professional who is blind to even a single weakness.

So if I was just starting out on my wealth-building journey, this is the path I would follow for my first few years. Luckily the ASX has an ETF that tracks Buffett's index of choice, the S&P 500. The iShares S&P 500 ETF (ASX: IVV) has given ASX investors an average return of 16.82% per annum over the past 10 years.

The magic of compound interest

If an investor starts by putting $20 a week into this index fund, they will have $1,040 after a year. Say our investor keeps this up, and the S&P 500 ETF retains this historical rate of return (which is by no means guaranteed), then they will have a total investment portfolio worth just under $30,000 within 10 years.

If left for another ten years (provided the $20 a week continues), this could grow to more than $165,000, and to almost $810,000 over the ten years after that. Such is the power of compounding.

As our investor grows in confidence, then they can perhaps try and beat the market by investing in individual shares like Buffett and boost these returns even more. But if I were just starting out today, this is certainly the Buffett wisdom I would follow.

The post I'd invest $20 a week the Warren Buffett way as I aim to build wealth appeared first on The Motley Fool Australia.

There are some ASX shares that could grow wealth for investors for a very long time. Certainly, I think they're contenders for creating generational wealth.

I'm looking for businesses that can grow profit beyond the foreseeable future. It can also help wealth-building if those investments pay dividends. I think investors can benefit from companies that can produce both growing dividends and profit growth over time, which could lead to very good returns over the long term.

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

Soul Pattinson is one of the oldest businesses on the ASX. It was listed in the 1900s as a pharmacy business but the company is now a diversified investment house. It has investments across a range of different sectors including financial services, resources, telecommunications, building products, agriculture, and so on.

The business has been growing wealth for shareholders for a long time. At the company's annual general meeting (AGM), it said that its total shareholder returns (TSR) were an average of 12.5% per annum over the prior 20 years, which was 3.4% higher than the All Ordinaries Accumulation Index (ASX: XAOA).

This ASX share has also grown its dividend every year since 2000. Over the last 20 years, it has grown at a compound annual growth rate (CAGR) of 8.5%.

The company continues to grow and diversify its investment portfolio, with long-term growth potential.

iShares S&P 500 ETF (ASX: IVV)

One of the world's greatest investors, Warren Buffett, has suggested that most investors would do very well with an S&P 500 fund. That's because they typically come with low management costs and offer investors significant diversification. The ASX share has an annual management fee of just 0.04%.

Taking a passive approach means investors can just sit back and (hopefully) enjoy the long-term growth of the exchange-traded fund (ETF).

The S&P 500 represents 500 of the biggest and most profitable businesses listed in the US. While they're listed in the US, many of them are global businesses such as Microsoft, Alphabet, Amazon.com, Apple, McDonald's, Costco, Starbucks, and so on.

Past performance is not a guarantee of future returns, but over the past five years to January 2023, the iShares S&P 500 has made an average return per annum of 12.3% and over the past decade, the average return per annum was 16.98%.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This ETF is constructed by a team of analysts at share research outfit Morningstar.

The ETF only invests in US shares, not ASX shares, though the underlying earnings are usually globally diversified.

The VanEck Morningstar Wide Moat ETF considers businesses from a watchlist of companies that are deemed to have competitive advantages that are expected to endure for at least a decade and probably for two decades.

But, it doesn't own hundreds of positions. It currently has 49 holdings as at 16 February 2023. The investment team believe that the shares were "trading at attractive prices relative to Morningstar's estimate of fair value".

This ETF has actually outperformed the S&P 500. Over the past five years, it has produced an average return per annum of 14.54%, that's after the annual management fee of 0.49%. But, remember that past performance is not a guarantee of future returns.

The post 3 ASX shares that could create lasting generational wealth appeared first on The Motley Fool Australia.

If you're not overly keen on stock picking, then exchange traded funds (ETFs) could be a good alternative. That's because ETFs allow investors to buy large groups of shares through a single investment.

But which ETFs could be worth considering? Three quality ETFs to look at are listed below, here's what you need to know about them:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

The first ETF to look at is the BetaShares NASDAQ 100 ETF. If you want to buy many of the highest quality companies in the world in one fell swoop, then this ETF allows you to do it. That's because the BetaShares NASDAQ 100 ETF gives investors access to the 100 largest non-financial shares on the famous NASDAQ index. This means you'll be owning shares in giants such as Alphabet, Amazon, Apple, Meta, Microsoft, Netflix, and Tesla.

iShares Global Consumer Staples ETF (ASX: IXI)

Another ETF for investors to look at is the iShares Global Consumer Staples ETF. With interest rates rising across the globe, there are concerns that a global recession could be around the corner. The good news is that even if one does occur, the companies included in this ETF are likely to remain well-placed to navigate the crisis. That's because this ETF gives investors exposure to many of the world's largest global consumer staples companies such as Coca-Cola, Nestle, PepsiCo, Procter & Gamble, Unilever, and Walmart. Demand for their products is relatively consistent whatever is happening in the economy.

iShares S&P 500 ETF (ASX: IVV)

A third and final ETF for investors to look at is the iShares S&P 500 ETF. This ETF gives investors access to 500 of the top listed U.S. companies. This means you'll be buying a slice of companies such as Amazon, Apple, Disney, Facebook, JP Morgan, Johnson & Johnson, Microsoft, Tesla, and Visa. This is a more diverse group of shares compared with the tech-heavy Nasdaq 100 ETF. So, if you're not overly bullish on the tech sector, this ETF could be a great alternative.

The post Here are 3 quality ETFs for ASX investors to buy right now appeared first on The Motley Fool Australia.

If you're wanting to invest but aren't sure which shares to buy, then exchange traded funds (ETFs) could be a good option.

This is because ETFs allow you to buy a large number of shares through a single investment.

But which ETFs could be top options right now? Here are two that could be worth considering:

BetaShares Global Energy Companies ETF (ASX: FUEL)

The first ETF for investors to look at this month is the BetaShares Global Energy Companies ETF.

As its name implies, this ETF provides investors with an easy way to gain exposure to the energy sector, which is benefiting greatly from high oil prices at present.

In fact, just yesterday Shell reported its highest profits in its 115-year history. The energy giant doubled its full year earnings to a whopping US$39.9 billion.

The good news is that Shell is one of the leading energy producers that the ETF gives investors access to. Other holdings include fellow energy giants BP, Chevron, ConocoPhillips, ExxonMobil, Phillips 66, and Total.

iShares S&P 500 ETF (ASX: IVV)

Another ETF for investors to look at in February is the iShares S&P 500 ETF.

This ETF gives investors easy access to Wall Street's famous S&P 500 Index. This index is the benchmark in the United States and covers a wide range of sectors including energy, real estate, healthcare, and tech.

This means that buying this ETF provides almost instant diversification for a portfolio.

Among the 500 companies included in the fund are household names and industry giants. These include Amazon, Apple, Warren Buffett's Berkshire Hathaway, Facebook (Meta), JP Morgan, Johnson & Johnson, Mastercard, Microsoft, Tesla, Visa, and Walmart.

The post 2 fantastic ETFs for ASX investors to buy in February appeared first on The Motley Fool Australia.

Building up an ASX share portfolio from scratch is no easy feat. For a beginner investor, there are so many shares to choose from, so many places to get advice, and so little time.

So let's make the whole process easier by discussing three ASX shares I would use to start a share portfolio from scratch today.

3 ASX shares I would use for a beginner portfolio

Vanguard Australian Shares Index ETF (ASX: VAS)

I think a beginner investor should start simple, and there are fewer investments simpler than this exchange-traded fund (ETF). Index funds like the Vanguard Australian Shares ETF hold multiple shares within them, making them very easy to get some healthy diversification right off the bat. In this ETF's case, it holds the 300 largest shares on the market.

That means an investment into this fund is an investment in everything from Commonwealth Bank of Australia (ASX: CB)A, BHP Group Ltd (ASX: BP) and Telstra Corporation Ltd (ASX: LS) to Woolworths Group Ltd (ASX: WOW), Ampol Ltd (ASX: ALD) and JB Hi-Fi Limited (ASX: JBH), all in one easy investment.

This ETF will give an investor the returns of the broad Australian share market, no more no less. It has returned an average of 8.79% per annum, including dividend returns, since its inception in 2009. That includes its competitive fee of 0.1% per annum.

iShares S&P 500 ETF (ASX: IVV)

ASX shares are great. But the reality is that most Australian investors don't bother looking beyond our shores, happy with the dividends and franking credits that shares like CBA, Telstra and Westpac Banking Corp (ASX: WBC) offer.

But the US markets are home to companies that are just on another level to our best businesses. Think Apple, Alphabet (owner of Google), Amazon, Mastercard, McDonald's, Tesla and Netflix.

These are some of the best companies on the planet and are all found in this index fund that tracks the 500 largest American companies. And again, you can get all of them in one, simple investment.

As such, this ETF can add even more diversification, geographic as well as currency, to a beginner portfolio. This ETF has averaged a return of 17.26% per annum over the past decade.

MFF Capital Investments Ltd (ASX: MFF)

Our last two investments have been simple index funds. But MFF Capital – a listed investment company (LIC) – adds some active management to our starter portfolio.

MFF, as a LIC, doesn't blindly track an index. Instead, the company owns a portfolio of other shares itself, which its management team runs on behalf of its investors. Its current boss is Chris Mackay, who is one of the co-founders of Magellan Financial Group Ltd (ASX: MFG).

MFF typically invests in a small portfolio of quality US shares. Some of its long-term top holdings include Mastercard, Amazon, Visa, American Express and Microsoft. I think this LIC is a great way of adding some investing expertise to a portfolio and compliments our two index funds nicely.

The post How I would use these 3 ASX shares to build a portfolio from scratch appeared first on The Motley Fool Australia.

This year could be a great time to start investing in ASX shares in 2023 for beginners for a few different reasons.

I think investing in ASX shares can be a great way to build wealth over the long term.

Historically, the ASX share market has returned an average of between 9% to 10% per annum. That includes dividends being re-invested, but not any relevant franking credits.

One of the advantages is that investors can begin with as little as $500. Buying a property can take a deposit of tens of thousands of dollars.

If $500 were to compound at 10% per annum for a decade, it would grow to around $1,300. But, we don't know what future returns are going to be. It could grow to an even bigger amount or less than that.

Though, over any given year, share prices can seem quite volatile. But that's normal.

Just look at how Commonwealth Bank of Australia (ASX: CBA) shares have moved over the past 12 months.

What would be a good place to invest $500?

There are a few different ways to invest for beginners.

Starting by investing in a business that we see in everyday life could be a good place to begin with. It might be more tangible for an investor to see their business in real life.

Examples of blue chips that might be interesting include Telstra Group Ltd (ASX: TLS), Coles Group Ltd (ASX: COL), Westpac Banking Corp (ASX: WBC), Wesfarmers Ltd (ASX: WES) (which owns Bunnings and Kmart), REA Group Limited (ASX: REA) (which owns realestate.com.au) and Qantas Airways Limited (ASX: QAN).

But, if it's hard to make a choice, there are ASX share investments that enable people to invest in a whole group of businesses in one investment. Investors can buy a whole basket of shares in one go. One of the most popular ways to do it is called an exchange-traded fund (ETF).

There are ETFs that investors can pick that give access to the global share market or the Australian stock market.

For example, the iShares S&P 500 ETF (ASX: IVV) is invested in 500 of the biggest US businesses. While they are listed in the US, most of them are global companies such as Apple, Microsoft, Amazon.com, Berkshire Hathaway and Alphabet (Google). ETFs can provide great diversification.

ETFs are administered by a fund manager, and that fund manager charges an annual fee. The iShares S&P 500 ETF has a very low fee of just 0.04% per annum, while there are others that can charge 1% or even more. The higher the fee, the more the long-term value of the portfolio is reduced. The effect of fees compound as well.

But, I don't think beginners should go for a small, or risky, ASX share to start with. It's good to start with an investment that has a good chance of working out well.

However, The Motley Fool website is a great place to find resources on researching ASX shares and industries.

Foolish takeaway

I think ASX shares can be a really good way to grow $500 into a larger amount over the long term. But, whatever an investor goes for, it's important to be patient. A good investment can take a while to play out into a positive outcome. Share market volatility can be painful in the short-term, but can provide opportunities to buy shares at cheaper levels.

The post How I'd invest my very first $500 in ASX shares in 2023 appeared first on The Motley Fool Australia.

Exchange traded funds (ETFs) provide investors with the opportunity to invest in a large number of shares from all corners of the world through a single investment.

This clearly has gone down well with Australian investors. One in seven Australians reportedly own an ETF, with a total of $136.9 billion invested in them locally as of late last year.

But given the high number of ETFs to choose from, it can be hard to decide which ones to buy.

To narrow things down, listed below are two high quality options to consider when the market reopens. Here's what you need to know about them:

Vanguard MSCI Index International Shares ETF (ASX: VGS)

The first ETF for investors to look at is the Vanguard MSCI Index International Shares ETF.

This is one of the most popular ETFs on the Australian share market. And that's not a big surprise because the Vanguard MSCI Index International Shares ETF provides investors with exposure to ~1,500 of the world's largest listed companies.

This makes the ETF a great way for investors to instantly diversify their portfolio and gain exposure to global economic growth.

Among the companies you'll be owning a slice of with this ETF are global giants such as Apple, ASML, Exxon Mobil, Johnson & Johnson, Nestle, Procter & Gamble, and Visa.

iShares S&P 500 ETF (ASX: IVV)

Another ETF for investors to consider buying when the market reopens is the iShares S&P 500 ETF.

This popular ETF aims to provide investors with the performance of Wall Street's famous S&P 500 Index before fees and expenses. This index is home to 500 of the largest listed companies on the US market.

BlackRock, the owner of iShares, believes the ETF can be used by Australian investors to diversify internationally and seek long-term growth opportunities for a portfolio.

Among the 500 companies included in the fund are giants including Amazon, Apple, Berkshire Hathaway, Facebook, JP Morgan, Johnson & Johnson, Microsoft, and Tesla.

The post 1 in 7 Australians own an ETF: Are these the ones to buy? appeared first on The Motley Fool Australia.

The ASX stock market has seen plenty of pain in 2022. Are things about to get even worse? Maybe it doesn't matter.

Some investors are always trying to guess what's going to happen next. The shorter the time period, the harder it is to be right.

Perhaps we don't need to adjust our investments or thoughts at all, if we're thinking long term. What happens in 2023 isn't that important if we're investing for 2030 or beyond.

But that's not the only reason to stay positive.

According to a report from Sharesies for the fourth quarter of 2022, investors are still confident about the long term and are focused on building wealth.

Survey results

A survey of over 1,600 investors showed that 80% of those surveyed "aren't worried about their investments over the next six months," with 69% of people investing for 10 years or more. It shows that the investors surveyed are still investing with the long term in mind.

We also learned that the majority of people using the Sharesies platform, 63%, are sticking with their investment strategy during stock market volatility.

The survey also revealed that 50% of people have the same risk appetite as the last six months, while 18% have a higher risk appetite.

What to make of this

Individual investors are unlikely to be able to move the market in any meaningful way at the moment. Institutional investors have much more market power due to their size.

But, I think it goes to show that some people are seeing this volatility as an opportunity to buy shares, while thinking long term.

I think that one of Warren Buffett's most famous sayings may be apt during this period:

Be fearful when others are greedy and greedy when others are fearful.

What this suggests is that it's a good time to invest in the stock market when investors are selling and prices are dropping. This could describe the current situation, with the S&P 500 Index (SP: .INX) down by around 20% in the year to date. ASX investors would have seen that the iShares S&P 500 ETF (ASX: IVV) is down by 16% in 2022.

I don't think that the global share market is going to get back to former heights any time soon. But, I don't think it'd be wise to stay negative for too long, particularly if share prices were to drop to a lower level. I'm using this as an opportunity to buy shares at a cheaper price.

The post Stock market forecasts keeping you up at night? This might help you sleep soundly appeared first on The Motley Fool Australia.

This is rather unusual for an ETF that has just traded ex-distribution.  

Yes, the iShares S&P 500 ETF is set to pay out its latest dividend distribution to investors on 5 January next year. But for a company or an ETF to pay out a dividend or distribution, it must first set an ex-dividend (or ex-distribution) date. This is the day that divides who gets the latest dividend and who doesn't.

Any investor who owned units of the iShares S&P 500 ETF as of yesterday is eligible to receive the 5 January distribution of 12.63 cents per share. Any investor who buys them from today onwards is ineligible.

Normally, this ex-distribution date would result in a fall in share price, reflecting the loss of value of this distribution for new unitholders. But that doesn't seem to be happening today.

Perhaps the rise of the S&P 500 Index (SP: .INX) itself overnight (up 0.1%), as well as currency fluctuations, were enough to keep the iShares S&P 500 ETF in the green this Wednesday.

iShares S&P 500 ETF doles out latest quarterly dividend

The iShares S&P 500 ETF is a rather unusual ASX investment because it pays out a dividend distribution every quarter, rather than every six months, which is the norm here on the ASX. This is probably due to the fact that this ETF tracks the American S&P 500 Index. The S&P 500 is the flagship index of the US markets.

It tracks 500 of the largest listed companies in America. These are dominated by the tech giants like Apple, Alphabet and Amazon. But you'll find most of the US' famous names here too, like Coca-Cola Co, Visa and McDonald's.

In the US, quarterly dividends are the norm, with most companies forking out four dividends per year. As such, it's easy to see why the iShares S&P 500 ETF follows this pattern.

This latest dividend distribution brings this ETF's trailing dividend distribution yield to 1.4%. The iShares S&P 500 ETF has delivered an average return of 18.27% per annum over the past ten years.

The post What's going on with the iShares S&P 500 ETF (IVV) today? appeared first on The Motley Fool Australia.

You'll find everything from Apple, Microsoft, and Amazon to Exxon Mobil, Costco, and Tesla here in this ETF. As well as American Express, Coca-Cola, and Kraft Heinz.

US shares are not known for their high dividends, which of course don't come with franking credits either. But the S&P 500 Index still has a robust dividend record and, as such, so does the iShares S&P 500 ETF.

This fund actually pays out a dividend distribution every quarter, not every six months, as is the norm here in Australia.

When is the iShares S&P 500 ETF's latest dividend distribution?

The iShares S&P 500 ETF's next dividend distribution is coming soon too. How soon? Well, investors can look forward to their next quarterly payout on 5 January. But if they wish to receive it, any new investors had better be quick. This ETF is scheduled to trade ex-distribution tomorrow, 21 December.

That means that any investor who doesn't own iShares S&P 500 ETF units by the end of today's trading session will be ineligible for this latest dividend distribution.

This is the iShares first dividend distribution payment since this ETF's recent stock split. The fund split its units in a 15-to-1 unit division earlier this month.

iShares only released exactly how much investors can expect from this latest payout this morning. Unitholders can look forward to receiving a payment worth 12.63 cents per unit on 5 January. That will bring this ETF's total distributions for the past 12 months to 53.6 cents per share on a post-split basis.

This total gives the iShares S&P 500 ETF a trailing dividend distribution yield of 1.4% on the current unit price of $38.15 (at the time of writing).

The post Hoping to secure the next iShares S&P 500 ETF (IVV) dividend? Read this appeared first on The Motley Fool Australia.

The ASX share market and global stock market have been through a rollercoaster in 2022. What does 2023 have in store?

I believe looking at the performance of the US share market – which covers a wide range of global companies – is a good proxy for how investors are feeling about the situation.

One of my preferred ways to evaluate the performance of the US share market is to look at the exchange-traded fund (ETF) iShares S&P 500 ETF (ASX: IVV).

For the year to date, it's down by more than 13%, though by mid-June it was down by more than 20%.

While a 13% drop isn't as much as the declines of plenty of individual ASX shares this year, such as Xero Limited (ASX: XRO), it still represents a negative turnaround from the returns we've seen in the last couple of years and indeed the past decade.

Given how high interest rates are – and they're still going higher, at least in the US – could 2023 see another crash for the ASX share market?

Why 2023 may be another tough year

The interest rate can have a very big impact on the valuations of assets — the higher it goes, the more it's supposed to hurt valuations, in theory. The US Federal Reserve is probably the world's most important central bank, and has been dealing with very high inflation in the US, which has had an impact on the global stock market.

While US inflation may start to settle down in 2023, Federal Reserve boss Jerome Powell has indicated that it could still take some effort to get inflation back to a stable level. This could see the US interest rate go above 5% and stay relatively high for longer than expected.

With the iShares S&P 500 ETF up 9% since the low in June 2022, and the S&P/ASX 200 Index (ASX: XJO) up around 11% since mid-June, the market may already be thinking the worst is over. In time, this could end up being a premature conclusion.

It could take some time for the full effect of these interest rate rises to flow through the Australian and US economies. The central banks want to take the heat out of the economy, but the higher costs to consumers and households could lead to a downturn, hurting the overall earnings of companies within the ASX share market.

Seeing as normal businesses are typically valued by their profitability, a downturn could hurt investor sentiment and put us back into a bear market.

Of course, there is also something completely unpredictable that could cause problems for the global stock market as well.

The case for uncertainty to improve in 2023

I think the share market is largely forward-looking. When the future seems dramatically uncertain, we see large sell-offs. This happened earlier this year when it was uncertain how high inflation would go. Yet, despite interest rates rising even higher, the ASX share market has risen.

For example, at the start of the COVID-19 pandemic, the bottom of the plunge for many businesses on the global stock market was in March 2020, even though there were a growing number of cases, deaths, and lockdowns in the subsequent months.

There are signs that the worst of inflation is over, which could bring forward the peak interest rate. The US Federal Reserve 'only' increased its interest rate by 50 basis points last week rather than 75 basis points. Collectively, the market may be comfortable enough with what's going to happen next.

It's normal for the stock market to go up and down, but with central banks slowing down the rate increases, we may have moved past the worst of things, even if there is a bit of volatility.

Foolish takeaway

I think we may have seen the low point for the share market when it comes to this period of rapidly rising interest rates. So, I'm not expecting the share market to fall further than we saw in June.

But, it's certainly possible that the ASX share market could drop 10% or 15% at some point over 2023, particularly if it starts from a comparatively higher level. If an asset goes up 10% and then drops 10%, it's roughly back to where it started.

The post Will there be a stock market crash in 2023? appeared first on The Motley Fool Australia.

Blackrock decided to do a stock split with the iShares S&P 500 ETF – it's a 15:1 stock split, which is why the unit price has gone from close to $600 to around $40.

The ETF returned to normal trading on a normal settlement basis this week.

I think it's important to remember that a stock split doesn't mean investors have more or less invested in the ETF. A $1,200 investment is still worth $1,200 whether it was spread across two units or 30. The pizza has been divided into many more slices, but it's still the same amount of pizza.

Is the iShares S&P 500 ETF a buy?

Warren Buffett himself has said that (American) investors can do well by just investing in an S&P 500 fund.

I think it's attractive for a number of different reasons.

For starters, the fund has an extremely low annual management fee of just 0.04%. This means investors can get exposure to the portfolio for almost nothing.

I think it's a great portfolio. Everyone may have their own thoughts on the US economy, but many of the businesses listed in the US are global powers in their respective industries.

Apple sells its smartphones all over the world. Microsoft's office software and Xbox consoles have a worldwide user base. Amazon's e-commerce is growing, along with its cloud computing service AWS. Alphabet's Youtube, Google Search and more are used by people worldwide.

There are many other worldwide businesses in the portfolio such as Berkshire Hathaway, Tesla, Johnson & Johnson and Exxon Mobil.

The ETF has produced solid returns over the past three years, despite a large amount of volatility that investors have suffered from because of high inflation and rising interest rates.

In the five years to November 2022, the iShares S&P 500 ETF had returned an average of 13.5% per annum. While past performance is not a reliable indicator of future performance, I think it shows the types of returns that the underlying businesses are capable of producing over time.

Foolish takeaway

While the future is uncertain – there's always uncertainty – I think that the iShares S&P 500 ETF is a leading idea to consider for investors that want to invest in ETFs focused on international shares. The stock split doesn't really mean anything in terms of how attractive the investment is, but I think it's compelling as a passive investment option.

The post Is the iShares S&P 500 ETF (IVV) a buy following its stock split? appeared first on The Motley Fool Australia.

Something strange is happening with the iShares S&P 500 ETF (ASX: IVV) this week. Back on Monday, units of this exchange-traded fund (ETF) were trading for almost $600 each. But today, this ETF is going for just $39.07 per unit. It also seems to have a new ticker code.

So has this popular ASX ETF really lost almost 95% of its value this week?

The iShares S&P 500 ETF is one of the most widely-held ETFs on the ASX. It's actually the ASX's most popular internationally-based fund. This ETF tracks the S&P 500 Index (SP: .INX), which is the most widely tracked index in the world.

It represents the 500 largest companies on the US markets by market capitalisation. That includes everything from Apple, Microsoft, and Amazon to Exxon Mobil, Coca-Cola, and McDonald's.

So no, this ETF hasn't collapsed by 95% this week. If the US S&P 500 Index was down 95% in one week, we'd certainly all know about it.

Rather, this ETF has just undergone a stock split.

A stock split for the S&P 500 ETF?

A stock split occurs when a company or ETF decides to increase its share (or, in this case, unit) count. It issues new shares (or units) to existing investors, at the same time diluting the value of the existing shares out there.

This has the effect of lowering the share (or unit) price of the company or ETF, but makes up for this by giving away new shares (or units).

This can be done for a number of reasons. But most do so to boost liquidity and to make it easier for investors to buy and sell shares or units.

At the start of this week, one single unit of the iShares S&P 500 ETF would set an investor back almost $600. That makes it a rather unwieldy investment to have to deal with.

This ETF's provider must have thought so too, because back on 23 November, BlackRock announced that the iShares S&P 500 ETF would be undergoing a 15-to-1 stock split.

That means that for every one unit of this ETF, investors now own 15. Concurrently, the unit price of this ETF has just been reduced by a factor of 15.

So if an ASX investor used to own 10 iShares S&P 500 units, worth $5,860, today, they own 150 units, each worth $39.07. Same value, different path to getting there.

So no investor has been left better, or worse off, from this split. It's just a cosmetic change for all intents and purposes.

Is it IVV or IVVDB?

But what's with the new ticker code? Yes, the iShares S&P 500 ETF used to trade under the code 'IVV'. But today, the ETF has seemingly switched to 'IVVDB'. Well, this is a temporary situation.

As we covered last week, part of the stock split process involves the ETF trading under a 'deferred settlement' basis. So today, the 'IVVDB' units represent the deferred settlement units.

This will only be in place until 13 December. That's when the deferred settlement period will have concluded and the ETF reverts to its old 'IVV' code.

The IVVDB units will seamlessly be converted into IVV units when this happens. So if you're desperate to buy the newly-split ETF today, don't let the new code hold you back.

The post Is the iShares S&P 500 ETF (IVV) really down 95% today? appeared first on The Motley Fool Australia.

Exchange-traded funds (ETFs) technically don't have shares. Instead, investors buy units of ETFs. That's because they are buying into a trust, not a company.

But, just like shares, units can get expensive over time as well. And just like with a share, an ETF provider can order a stock split of its units.

That's exactly what is happening with the iShares S&P 500 ETF (ASX: IVV) very soon.

S&P 500 ETF to undergo stock split

The iShares S&P 500 ETF is one of the most popular international ETFs on the ASX. It invests in a portfolio tracking the S&P 500 Index. This is the most dominant index representing the US market. It's also the most widely tracked index in the world.

Everyone who's anyone in the US markets can probably be found in the S&P 500. Apple, Amazon and Alphabet are all there. As are Ford, Microsoft, Coca-Cola, Tesla, and McDonald's.

Yet today, one unit of the iShares S&P 500 ETF will cost an ASX investor $598.65 – no mere chunk of change. By comparison, one unit of the Australian-focused iShares Core S&P/ASX 200 ETF (ASX: IOZ) will only set an investor back $29.18 right now.

But this is about to change. Last week, BlackRock, the ETF provider behind these two funds, announced a stock split for the iShares S&P 500 ETF. This will be a 15:1 split, which will see each unit of the ETF become 15 units.

This will have the effect of lowering the cost of one unit by a factor of 15 times, with all unitholders getting 15 times as many shares as they currently own in compensation.

So if an investor owns a single share of the iShares S&P 500 ETF today, valued at $598.65, they will own 15 units, each worth $39.91, following the split. Overall, the investor won't see either an increase or decrease in their overall position.

IVV or IVVDB?

The last day that units of the iShares S&P 500 ETF will trade on a pre-split basis will be 6 December. Trading will then commence the following day on a post-split basis.

However, this ETF will temporarily use the ticker code IVVDB while trading on a deferred settlement arrangement from 6 December onwards. The ETF will only return to its old code of IVV and to normal trading on 13 December.

So if you own units of the iShares S&P 500 ETF, get ready to own a lot more at a far lower unit price.

The post What you need to know about next week's iShares S&P 500 ETF (IVV) stock split appeared first on The Motley Fool Australia.

An ETF is a fund, a basket of shares, that can be bought on the ASX.

It hasn't been long since I was in my 20s, but people in their early 20s have plenty of time to enable compounding to do a lot of the work to build a healthy financial nest egg.

There are many different ETFs to choose from. I'd want to choose ones that seem to have long-term growth potential. That's why I'd want to look at the two below.

iShares S&P 500 ETF (ASX: IVV)

This is one of the most popular ETFs on the ASX, with a fund size of around $5 billion according to Blackrock.

The ETF is invested in 500 of the biggest businesses listed in the US which is where many of the world's largest businesses are based. Of course, past performance is not a reliable indicator of future performance, but the 14.2% average return per annum over the prior five years has shown how well the underlying businesses have grown.

At the moment, the fund's biggest holdings are Apple, Microsoft, Amazon.com, Alphabet, Tesla, and Berkshire Hathaway. Of course, there are almost 500 others.

One of the most attractive things about this ASX ETF is that its management fee of 0.04% is exceptionally low. Plenty of active fund managers charge at least 1.00%.

I think the holdings offer considerable diversification. While they're all listed in the US, the underlying revenue comes from across the world, and the positions are from a variety of sectors like tech, retail, financials, healthcare, and so on.

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

This ETF is slightly different in a number of ways.

It has 200 businesses in its portfolio, but they are listed in countries across the world. While the US accounts for just over 70% of the portfolio, Japan, Switzerland, the Netherlands, Germany, and the UK each account for over 2%.

The biggest difference between the two portfolios is how they are constructed. The iShares S&P 500 ETF just copies the underlying index – I think it's a great index.

However, this ASX ETF has an ethical slant. It combines "positive climate leadership screens" with a "broad set" of environmental, social, and governance (ESG) considerations.

It excludes a number of areas from its investing. These include fossil fuel producers, companies significantly engaged with gambling or alcohol, companies with human rights or supply chain issues, companies that lack gender diversity on their boards, and so on.

It starts with the global large-cap universe. What's left after those exclusions are the 200 largest 'ethical' businesses.

On 22 November 2022, its largest positions were: Home Depot, Visa, Apple, Mastercard, Toyota, and Nvidia.

For investors who only want to own businesses that they feel good about, then this ASX ETF could be a good option.

The post 2 ASX ETFs I'd buy right now if I were in my 20s appeared first on The Motley Fool Australia.

This is because ETFs allow you to buy a large number of shares through a single investment.

With that in mind, listed below are two high quality ETFs that could be good long-term options for investors. Here's what you need to know about them:

BetaShares Global Energy Companies ETF (ASX: FUEL)

The first ETF for investors to look at is the BetaShares Global Energy Companies ETF.

This ETF provides investors with an easy way to gain exposure to the energy sector, which is benefiting from high oil prices. This is because this ETF allows investors to own a slice of some of the biggest energy companies in the world.

BetaShares points out that these companies are larger, more geographically diversified, and more vertically integrated than Australian-listed energy companies. Among the fund's holdings are energy giants BP, Chevron, ConocoPhillips, ExxonMobil, Phillips 66, Royal Dutch Shell, and Total.

iShares S&P 500 ETF (ASX: IVV)

Another ETF for investors to consider buying is the iShares S&P 500 ETF.

This ETF aims to provide investors with the performance of Wall Street's famous S&P 500 Index before fees and expenses.

The operator of the fund, BlackRock, believes the ETF can be used by Australian investors to diversify internationally and seek long-term growth opportunities for a portfolio.

Among the 500 companies included in the fund are some absolute giants. These include Amazon, Apple, Berkshire Hathaway, Facebook, JP Morgan, Johnson & Johnson, Microsoft, and Tesla.

The post 2 high quality ETFs for ASX investors to buy now appeared first on The Motley Fool Australia.

This is because they provide investors with easy access to a large and diverse number of different shares.

But which ones would be top options for investors in November? Listed below are three that could be worth considering:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

The first ETF for investors to consider is the popular BetaShares NASDAQ 100 ETF. This ETF gives investors exposure to many of the largest companies in the world. This includes the likes of Amazon, Apple, Microsoft, Netflix, and Tesla. The operator of the ETF, BetaShares, notes that with its strong focus on technology, the ETF provides investors with diversified exposure to a high-growth potential sector that is under-represented on the ASX.

iShares S&P 500 ETF (ASX: IVV)

Another ETF to consider is the iShares S&P 500 ETF. This ETF gives investors access to 500 of the top listed U.S. companies through a single investment. This means that you'll be buying a diverse group of companies such as Amazon, Apple, Disney, Facebook, JP Morgan, Johnson & Johnson, Microsoft, Tesla, and Visa.

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

A final ETF for ASX investors to consider in November is the VanEck Vectors Video Gaming and eSports ETF. This ETF gives investors access to a portfolio of companies involved in video game development, hardware, and esports. These include Activision Blizzard, AMD, Electronic Arts, Nintendo, Nvidia, Roblox, and Take-Two. The ETF's operator, VanEck, points out that these companies are well-placed to benefit from the increasing popularity of video games and eSports.

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Both of these ETFs provide investors with a large basket of shares from across the globe. Here's why they could be top options for investors right now:

iShares Global Consumer Staples ETF (ASX: IXI)

The iShares Global Consumer Staples ETF could be a top option for investors looking to diversify their portfolio. Particularly in the current uncertain economic environment.

That's because this ETF has been designed to measure the performance of the world's leading consumer staples companies.

Consumer staples companies produce or sell essential everyday products such as food, tobacco, and household items. These are products that experience relatively consistent demand whatever is happening in the economy.

Among its 100+ holdings are companies such as Coca-Cola, Coles Group Ltd (ASX: COL), Colgate-Palmolive, Diageo, L'Oreal, Mondelez, Nestle, PepsiCo, Procter & Gamble, Unilever, Walmart, and Woolworths Group Ltd (ASX: WOW).

iShares S&P 500 ETF (ASX: IVV)

Another ETF that could be a great option for diversification purposes is the iShares S&P 500 ETF.

This ETF aims to provide investors with the performance of the famous S&P 500 Index, before fees and expenses.

The S&P 500 Index is home to 500 of the largest listed companies on Wall Street. This means you'll be buying many of the largest and most well-known companies in the world in one fell swoop.

Among the ETF's largest holdings are giants such as Amazon, Apple, Coca-Cola Company, Johnson & Johnson, Mastercard, McDonalds, Microsoft, Nike, Tesla, and Visa.

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