If you're new to investing, exchange traded funds (ETFs) can be a great place to start.
They offer an easy way to buy large groups of shares, removing the need to pick stocks yourself.
With that in mind, here are three ASX ETFs that I think are well suited to beginners looking to build long-term wealth.
My first recommendation is the Betashares Diversified All Growth ETF, which I think is an excellent option for anyone wanting to keep investing simple.
This ETF provides exposure to approximately 8,000 stocks across Australia, the US, Europe, Asia and emerging markets.
What I like about this fund is that it takes away much of the decision-making involved in building a diversified share portfolio.
Instead of having to choose how much to invest in different countries or regions, investors can leave those decisions to the fund, which maintains a diversified mix of global shares.
It also charges a reasonable management fee of 0.19% per annum. This means for every $1,000 invested, just $1.90 is lost in fees.
For beginners with a long investment horizon, I think it offers a great way to start investing without making things unnecessarily complicated.
Another ASX ETF I'd recommend is the Betashares Australia 200 ETF.
This fund provides exposure to 200 of Australia's largest listed companies. This means you would be buying a slice of BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA) and Wesfarmers Ltd (ASX: WES).
I think this makes it a good option for beginners who want to invest in Australian businesses but aren't confident choosing individual shares.
After all, it can be difficult to know whether Commonwealth Bank, National Australia Bank Ltd (ASX: NAB) or Westpac Banking Corp (ASX: WBC) will perform best over the next decade.
With this ETF, investors can own all three, alongside many other leading Australian businesses.
Another positive is its low management fee of just 0.04% per annum, which means just 40 cents is lost in fees from every $1,000 investment.
This arguably makes it a cost-effective way to participate in the Australian share market's long-term growth and receive dividends along the way.
A final ASX ETF I'd recommend to beginners is the Betashares Nasdaq 100 ETF.
This fund invests in 100 of the largest non-financial companies listed on the Nasdaq stock exchange, giving investors exposure to some of the world's most successful technology and growth businesses.
Its holdings include giants such as Nvidia (NASDAQ: NVDA), Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT) and Amazon (NASDAQ: AMZN).
What I like about this popular fund is that many of its holdings are businesses that beginners will already know and use regularly.
Whether it's Microsoft's software, Amazon's cloud computing services or Apple's devices, these companies have become deeply embedded in our everyday lives.
And I believe their ability to keep developing new products and services, including artificial intelligence (AI), could support strong earnings growth over the next decade.
Of course, this ETF is more concentrated than the other two, which means it could experience greater volatility when technology shares fall.
Nevertheless, for beginners who are comfortable with these risks and have a long investment horizon, I think it could be an attractive way to invest in some of the world's leading growth companies.
The post 3 ASX ETFs I'd recommend to beginners appeared first on The Motley Fool Australia.
Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, Apple, BetaShares Nasdaq 100 ETF, Microsoft, Nvidia, and Wesfarmers. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Amazon, Apple, BHP Group, Microsoft, Nvidia, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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