It can be hard knowing which ASX shares to start with as a beginner.
Do you go for a business you’ve heard of like Telstra Corporation Ltd (ASX: TLS) or Coles Group Ltd (ASX: COL)?
What about a cheap exchange-traded fund (ETF) that can provide diversification like Vanguard Australian Shares Index ETF (ASX: VAS).
The ones I’ve mentioned aren’t terrible ideas. But, I think there are attractive options that can provide solid long-term growth and investors can feel good owning them. Here are two beginner ASX shares for any portfolio.
BetaShares Global Sustainability Leaders ETF (ASX: ETHI)
This is an ETF which really stacks up for investors wanting an ethical portfolio, but you also get diversification with loads of quality companies.
There are a total of 200 businesses from the global share market in this portfolio. Those companies only make it into the ETF after a number of industry exclusions such as no fossil fuels, no alcohol, no junk food, no supply chain concerns, they must have board diversity and so on.
Feel free to check out the full holdings list, but the latest disclosure showed these were the biggest positions: Nvidia, Apple, Visa, Home Depot, MasterCard, Cisco Systems, Toyota, ASML, UnitedHealth and Adobe.
Despite a lot of work going into the construction and maintenance of this portfolio, the annual management fee is only 0.59%. That’s pretty cheap compared to many active fund managers.
Past performance is not a reliable indicator of future performance, but the ETHI ETF has produced an average return per annum of 20.4% over the past five years.
Australian Ethical Investment Limited (ASX: AEF)
Australian Ethical is a fund manager. It generates earnings by managing other people’s money. It offers both superannuation and regular non-super investment funds.
This beginner ASX share’s main offering is funds that only invest in highly ethical businesses, which also have a much lower carbon footprint than a typical investment fund’s holdings, and can produce good returns.
Growth of funds under management (FUM) generally leads to higher revenue and profit. Fund managers are very scalable, it doesn’t need a 10% bigger office to manage 10% more money.
Australian Ethical’s FUM continues to grow at a good pace. More Aussies want their investments to have a higher level of ethics. They are voting with their investment choices. FUM finished at $6.9 billion on 31 December 2021, which was an increase of 38%.
The ASX share also donates 10% of its net profit to support various social and green charities and initiatives.
The Australian Ethical share price has fallen 52% since the start of 2022, so it could be an opportunistic time to consider the company.
