I think that April 2022 is a great time to be considering investing in ASX shares.
Once we invest, there’s not really anything we can do to influence the returns, except hope it does well.
The price we pay for an investment is very important.
There has been a lot of volatility since the start of the year. With these lower prices, it could be a good time to jump on opportunities:
WAM Microcap Limited (ASX: WMI)
The WAM Microcap share price has fallen 8.5% since the end of March 2022.
I think that the investment team at Wilson Asset Management (WAM) is very effective at picking small businesses, typically in the industrial space. This is a listed investment company (LIC) that is all about that investment strategy.
WAM Microcap is typically looking for businesses with growth potential where there’s a catalyst that could drive the share price higher. As the name suggests, it looks for microcap ASX shares, which are usually worth less than $300 million.
It has largely avoided the tech sector in the last few months, so its portfolio hasn’t dropped as much even though it does invest for growth.
Over the longer-term, the ASX share’s portfolio has done very well, in my opinion. To the end of February 2022, the WAM Microcap portfolio had delivered an average return per year of 21.7% since inception in June 2017. That was much better than the 9.3% average return per annum from the S&P/ASX Small Ordinaries Accumulation Index.
One bonus to the LIC is that it is a solid dividend payer for shareholders. It is steadily growing its ordinary dividend.
Betashares Climate Change Innovation ETF (ASX: ERTH)
This is an exchange-traded fund (ETF) that is focused on global businesses that are looking to fight climate change and “other environmental problems through the reduction or avoidance of CO2 emissions.”
The annual cost of this ETF is 0.65%.
The world will need to spend many billions of dollars to decarbonise to reach emissions targets. Therefore, demand for products and services to tackle the world’s growing climate and environment-related problems are anticipated to rise strongly over the long term, according to BetaShares.
The ETF provides exposure to a “broad range of solutions, including clean energy, electric vehicles, energy efficiency technologies, sustainable food, water efficiency and pollution control.” Fossil fuel companies and certain other activities are excluded.
In terms of the names in the ASX share’s 100-business portfolio, the biggest ten are: Tesla, Eaton, Vestas Wind Systems, American Water Works, Ecolab, Trane Technologies, Cie de Saint-Gobain, Nio, Enphase and Infineon Technologies.
The ERTH ETF share price has fallen 23% since the start of 2022.
