I believe there are several good opportunities on the ASX at the moment in my opinion.
It's quite hard to find good value with individual ASX shares right now because most of the good businesses are trading at high valuations.
Altium Limited (ASX: ALU), REA Group Limited (ASX: REA) and WiseTech Global Ltd (ASX: WTC) are perfectly good growth businesses, but they are priced expensively for that growth.
However, I think there are a few ASX shares I'm close to buying more of at the current valuations:
WAM Global Limited (ASX: WGB) – $3,500
Fees of fund managers are rightly under scrutiny when you can get perfectly acceptable compound returns from ETFs like iShares S&P 500 ETF (ASX: IVV) for a very low cost.
However, I think it can be a good investment opportunity to buy quality listed investment companies (LICs) when they're trading at a decent discount to the underlying assets.
Based on the pre-tax NTA at 28 February 2019 and a share price of $1.96, WAM Global is trading at a discount of around 8%. Over the long-term I think WAM Global will beat the global index with quality holdings like Alphabet (Google), CME Group, HCA Healthcare and American Express.
Challenger Ltd (ASX: CGF) – $1,500
Challenger is the country's leading annuity company with a market share of around 90% of new annuities.
The falling values of assets over the past six months damaged Challenger's financial half-year result. And the government's decision to delay new retirement income rules was also a blow.
However, I believe the long-term opportunity still looks good, particularly at this lower valuation. The number of people in retirement is expected to grow by 40% over the next decade. The size of annuities is also expected to grow because of compounding and mandatory superannuation contributions. This combination should lead to a pleasing inflow of funds.
Challenger is trading at 12x FY19's estimated earnings with a grossed-up dividend yield of 6.4%.
Vanguard FTSE Asia Ex Japan Shares Index ETF (ASX: VAE) – $2,500
This is my favourite exchange-traded fund (ETF) at the moment. It seems quite likely that Asia will become the dominant economic region this century, particularly if India's economy continues to power along and it invests significantly in infrastructure.
According to Vanguard, this ETF has a price/earnings ratio of 12.3x, an earnings growth rate of 11.9% and a return on equity (ROE) ratio of 15.8%. There aren't many ETFs out there that look as cheap with as good growth.
This ETF is likely to be quite volatile as China's stock market tends to go up or down more than typical western ones. As a bonus, this ETF has a decent dividend yield of 2.7%.
WAM Microcap Limited (ASX: WMI) – $2,500
For the first time since it listed, WAM Microcap appears to be trading at around its net tangible assets (NTA) per shares.
I believe in the long-term opportunity of WAM Microcap because it invests in the smallest shares on the ASX, which all of the passive ETF money is typically ignoring because these small caps aren't in the ASX 200 or ASX 300.
Small shares could produce the best returns because those little companies have long growth runways until they hit a growth ceiling.
WAM Microcap has a grossed-up dividend yield of 5.1%.
Foolish takeaway
I hope and believe each of these investments can soundly outperform the ASX index over the long-term, each of them are already sizeable positions in my portfolio.
