Westpac Banking Corp (ASX: WBC) and QBE Insurance Group Ltd (ASX: QBE) wouldn't be the first shares I buy for an investment portfolio.
2 shares I wouldn't buy
This is the second article to a piece I wrote earlier today: 2 ASX dividend shares I wouldn't buy for $10,000.
Here are two more ASX shares I wouldn't buy…
Westpac is one of Australia's top banks, with commanding stakes in the mortgage market and an array of personal banking products.
When it comes to investing, I think it makes sense to start with a company you know well. It's what I did when I started out. Instead, the first company I put on my watchlist was National Australia Bank Ltd. (ASX: NAB).
However, knowing what I know now, NAB and Westpac shares wouldn't be in my $10,000 portfolio. That's because I think Westpac is too risky and there's not enough reward up for grabs.
Westpac has grown quickly over the past two decades, as Australia has trudged forward without a recession or proper house price crash. Plus, it is already one of the biggest banks in Australia, so it may not grow as quickly as some other businesses can.
QBE Insurance is another business which new share market investors might add to their portfolios. The company is well-known for its general insurance products here in Australia and overseas, especially in the Americas.
However, QBE Insurance has been a poor investment since the Global Financial Crisis. The company's core operations have struggled to make enough money to offset the repeated poor performance of its international operations, particularly in South America.
At the end of the day, insurance businesses can be unpredictable and crippling on investors' returns. Therefore, I wouldn't recommend someone with a $10,000 portfolio buy QBE Insurance shares.
Foolish Takeaway
Being patient and focusing on your core strengths as an investor is important, especially when you are starting out. Before you think you don't have any strengths, you may consider your occupation, hobbies or personal shopping habits at a source of advantage.
For example, if you are a plumber, you will know Reece Ltd (ASX: REH) better than most professional investors. If you work at Woolworths Limited (ASX: WOW) you might have a good insight in which brands are selling fastest.
When you start building a share portfolio use these strengths to your advantage and focus on the long term.
