When it comes to the share market, self managed super fund (SMSF) investors generally focus on two main objectives:
- Receive a growing stream of dividends each year, and
- Avoiding permanent loss of capital
These objectives make sense, especially when you consider just how useful franking credits are to retired investors.
Luckily, there are plenty of shares on the ASX that cater nicely to SMSF investors.
With that in mind, here are five shares that SMSF investors could consider – at the right price:
Transurban Group (ASX: TCL)
Transurban is an attractive investment for long term investors when you consider the toll-road operator generally increases its toll charges each year above the rate of inflation. This should provide a consistently growing stream of dividends as long as the company can keep its costs in check. The shares also tend to perform well during periods of market volatility and this can be especially useful for conservative investors. With that said, I wouldn't rush out to buy the shares right away as there could be further downward pressure in the short term as investors react to rising bond yields.
Brambles Limited (ASX: BXB)
Brambles might not be the most exciting company on the ASX, but it has proven to be a consistent performer over many years. Importantly, the outlook for the pallet maker continues to look reasonably attractive as it should benefit from any uptick in the US economy. Brambles enjoys particularly strong market positioning and this means the shares generally trade on a premium valuation to the broader market. Nevertheless, a mild pull-back from current levels could be a good buying opportunity for risk averse investors looking for a predictable, but growing, dividend source.
WAM Capital Limited (ASX: WAM)
WAM Capital provides investors with exposure to one of the best-performing listed fund managers in Australia and, at the same time, offers a stream of growing, fully franked dividends. Investors also get the benefit of an investment with lower volatility than the broader market as the shares have a beta of just 0.79. Although the shares trade at a premium to the fund's underlying net asset value, this is unsurprising when you consider the fund has outperformed the S&P/ASX All Ordinaries Accumulation Index by 8.1% each year, on average, since 1999.
SPDR S&P/ASX 200 Fund (ASX: STW)
An exchange traded fund (ETF) can be a useful tool for investors who don't have the time, resources or patience to pick individual stocks. ETFs also offer a cost-effective alternative to managed funds and can be used as the building blocks in setting up a core portfolio position. The one I have listed here tracks the S&P/ASX 200 (Index: ^AXJO) (ASX:XJO) and charges a management fee of just 0.19% per year. Investors also get dividends paid semi-annually, with the current yield estimated to be 4.36%.
