ASX shares are great for beginner investors in my opinion.
It can take many thousands of dollars to start investing with your first property. But with shares you can start with as little as $500. That's a great way to start your compounding wealth journey if you don't have much to put to work.
Some shares may require a good understanding of the industry to buy. Whereas there are others that would be good ASX shares for beginner investors. It's a good time to start investing because the coronavirus has caused share prices to go lower.
Here are three ASX shares for beginner investors:
BetaShares NASDAQ 100 ETF (ASX: NDQ)
Some of the best businesses in the world are shares like Microsoft, Alphabet, Facebook, Apple, Amazon and so on. They're good not just because they're technology shares, but because they have high profit margins, loyal customers, good balance sheets and strong growth prospects.
We can't buy those tech giants directly on the ASX. But as a beginner investor you can buy exchange-traded funds (ETFs) like any other ASX share, which provides that exposure indirectly.
The management fee of 0.48% for this ETF is lower than most active Australian fund managers.
Including currency change effects, this ETF has been a strong performer. It has returned an average of 22% per annum over the past three years to 31 March 2020.
MFF Capital Investments Ltd (ASX: MFF)
I think MFF Capital is one of the best listed investment companies (LICs) on the ASX. It's run by the high-performing Chris Mackay. He has been very effective at leading MFF Capital, it has been perhaps the best LIC over the past decade.
The LIC invests in profitable businesses with strong market positions. Its two largest long-term holdings are Visa and Mastercard, which have been very strong performers.
MFF Capital recently increased its cash position to over 30% of the portfolio, so it's well protected if there were to be another market crash.
I think it's a great ASX share for beginners because of its low fees, strong long-term growth and focus on great international shares.
Bubs Australia Ltd (ASX: BUB)
Bubs is one of the most promising small caps on the ASX in my opinion. It sells quality infant formula and now has expanded its distribution to three of the biggest retailers of infant formula, being Woolworths Group Ltd (ASX: WOW), Coles Group Limited (ASX: COL) and Baby Bunting Group Ltd (ASX: BBN).
It's got all of the building blocks to turn it into a strong long-term growth share with its supply chain.
Bubs' revenue is growing at a fast rate and it was cashflow positive in the latest quarter after focusing on reducing costs.
There's a lot of potential growth with this ASX share for beginners.
Foolish takeaway
All three of these ASX shares could be good long-term ideas for beginners. I like the idea of MFF Capital the most because of its defensive setting and diversification. But Bubs could generate the biggest growth over the next five years.
