Monday, September 25, 2023

Investing in Australia: Stock Exchange Facts You Need to Know

The Australia stock exchange, formally known as the Australian Securities Exchange or ASX, first opened in 1986. Today, close to 9 million Australians hold stocks, and the exchange ranks 14th globally for direct foreign investment.

The ASX boasts over 2,000 companies and offers investors surprisingly diverse, flexible portfolio options.

Are you considering investing in Australia’s publicly listed companies? Read on to find out what you need to know before parking your hard-earned dollars.

Australia Is a Gold-Rich Nation

Mineral resource acquisition makes up a large portion of Australia’s economy, contributing about 10 percent. After all, the country is home to BHP, the biggest mining corporation globally, plus several other substantial holdings.

There are over 350 mines in action all over the country, and Australia has 19 types of minerals worth digging for. In other words, it’s big business and not looking to change any time soon.

The good news for those looking to invest in the Australian stock market is that Australia is rich in gold–one most popular commodities of choice globally.

Not Just Australian Companies

If you’re an investor looking to add energy or minerals to your portfolio, the Australian stock exchange index will seem an attractive prospect. This is because almostt half of the over 2,000 companies trading on the ASX are in these sectors. Other top industries include financial services, healthcare, and industrials.

But it’s not just Australian companies listed on the exchange. A small portion of that 2,000 (around 140) are foreign companies. This includes Canadian companies like Oceanagold, Perseus Mining, and  Kirkland Lake Gold. There are also a handful of companies from the US, mainly in the healthcare and technology sector.

Trade or Invest in the Australian Stock Exchange

So, how to trade on the Australian stock exchange? There are a few ways to go about it. Like most stock exchanges globally, you can buy and sell the individual shares of Australia stock exchange-listed companies. However, it’s also beneficial to consider your single trade or exchange-traded fund (ETF) options.

On the ASX, these options include:

  • Cash index CFDs
  • Index futures CFDs
  • ASX 200 EFTs
  • ASX 200 shares

Where you put your money depends on your level of investment experience, your individual financial goals, and your financial circumstances (how much money you have available to invest).

At the end of the day, if you’re unfamiliar with this complex exchange, it’s best to get some competent financial advice. Advisors like Monex guide you through your investment options and make sure you’re getting viable returns.

Invest in the Australia Stock Exchange

The Australia stock exchange offers investors within and outside Australia the opportunity to expand their investment portfolios in several key sectors. Those interested in exploring the minerals–especially gold–and finance sectors should seriously consider the ASX. If you’re worried about putting your money in the wrong place, speak with a financial advisor with experience in the Australian economic landscape.

For more savvy financial and investment advice, dive back into our blog to read more articles.