2 ASX shares I would recommend to a beginner investor

BHP Group Ltd (ASX: BHP) is one of the two ASX shares for a beginner investor that, in my opinion, anyone could safely hold forever.

| More on:
asx shares beginner investor represented by baby playing with gold coins and bags of money

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Recommending ASX shares to a beginner is a tough ask. Whilst I have enormous confidence in the two investments named below, investing is always uncertain. I doubt it, but for all I know, the two shares below could wind up being terrible investments over the next few years, as could any share I could possibly name.

But good investing is all about balancing risk and reward. And not investing at all is both far riskier and less rewarding than giving investing a crack, in my opinion. And so here are the two aforementioned ASX shares that I think have more than a reasonable chance of being great investments over the coming years for a beginner today:

2 ASX shares for a beginner today

BetaShares Nasdaq 100 ETF (ASX: NDQ)

This exchange-traded fund (ETF) is a great choice for a beginner in my view for two reasons. Firstly, as an ETF, this investment requires very little attention or even understanding. It simply holds the 100 largest companies in the United States Nasdaq Index, adjusted as needed. That means this fund will always be holding the 100 largest companies in the index, whatever they may be at any given time. I believe this means that you can buy-and-hold this ETF forever, without ever having to check it or worry about it. That's great for a beginner.

Secondly, the Nasdaq is the US index that most tech shares find themselves listing on. As such, its current top holdings are well-known tech names like Apple Inc (NASDAQ: AAPL), Microsoft Corporation (NASDAQ: MSFT) and Amazon.com Inc (NASDAQ: AMZN). But it also houses many up-and-coming growth companies like NVIDIA Corporation (NASDAQ: NVDA), PayPal Holdings Inc (NASDAQ: PYPL) and Tesla Inc (NASDAQ: TSLA). I think these companies will continue to grow over time and increase their weighting in this index. As such, this ETF is really a big bet on US tech, whose future I think is a great investment.

BHP Group Ltd (ASX: BHP)

My second ASX share for beginners is a completely different kettle of fish. BHP is one of the oldest and most famous companies on the ASX. It's one of the largest mining companies in the world, with significant operations across four core commodities: coal, copper, oil and iron ore. BHP is a very 'old-world' company. Even so, I think it's a great share for a beginner. You'll often hear from many older Aussie investors that their first share was 'the BHP'.

Quite simply, BHP has been around so long (and will continue to be in my view) because it mines commodities that the world can't live without. Almost every building needs steel and almost every electrical device on the planet needs copper. That isn't going to change in any of our lifetimes, in my opinion. This company won't make you rich quickly. But it's another great 'bottom draw' investment that I think a new investor could hold for a lifetime.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of Tesla. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon, Apple, Microsoft, NVIDIA, PayPal Holdings, and Tesla. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS and recommends the following options: long January 2021 $85 calls on Microsoft, short January 2021 $115 calls on Microsoft, short January 2022 $1940 calls on Amazon, long January 2022 $1920 calls on Amazon, and long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia has recommended Amazon, Apple, BETANASDAQ ETF UNITS, NVIDIA, and PayPal Holdings. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on How to invest

Man pointing an upward line on a bar graph symbolising a rising share price.
How to invest

How to invest when the ASX hits a record high

Worried about buying at today's prices? Here's why you shouldn't be concerned.

Read more »

A man wearing glasses sits back in his desk chair with his hands behind his head staring smiling at his computer screens as the ASX share prices keep rising
How to invest

Lessons from a self-made ASX millionaire

Here's how he did it.

Read more »

A couple cheers as they sit on their lounge looking at their laptop and reading about the rising Redbubble share price
How to invest

$20,000 in savings? Here's how to target $1,000 of passive income each month

This could be the easiest way to build a meaningful passive income from the share market.

Read more »

Three happy office workers cheer as they read about good financial news on a laptop.
How to invest

The 3 rules new ASX share investors should always follow

These rules could help you generate wealth in the share market.

Read more »

Person holding Australian dollar notes, symbolising dividends.
How to invest

How to build a $1,500 monthly income stream with ASX dividend shares

It isn't as hard as you think to build a monthly income stream on the share market.

Read more »

A smiling woman sits in a cafe reading a story on her phone about Rio Tinto and drinking a coffee with a laptop open in front of her.
How to invest

How to start your ASX share portfolio with just $1,000

Investing doesn't need to be hard. Here's an easy way to start.

Read more »

Happy young woman saving money in a piggy bank.
How to invest

How I'd invest $250,000 in Australian dividend stocks to never worry about money again

Here are a number of stocks that could be top options for income investors with money to put into the…

Read more »

Warren Buffett
How to invest

5 easy steps to invest like Warren Buffett with ASX shares

It isn't as hard as you might think to invest like the Oracle of Omaha.

Read more »