Unfortunately there's no one magic stock or ETF that's 'best' for everyone. Instead, you should look at your own individual needs and investment strategy to decide what stock is right for you. Further, nobody can say for certain which direction a share will go as past performance is no guarantee of future results. So keep in mind these are stock ideas only and should not be taken as personal financial advice.
Looking for the best ASX shares to buy for 2023? We've compiled a list of stocks using an algorithm that considers factors such as price performance, volatility levels and profit margins to find 20 stocks that might be worth watching over the year ahead.
Unless you have a crystal ball, it's impossible to say what the next 12 months will look like. But there are some big themes that are currently driving the market in 2023:
With all that in mind, it's not easy picking quality stocks. To help identify stock picks for 2023, we used Finder's proprietary algorithm to filter Australia-listed companies that have strong fundamentals. We take into account historical prices, dividends, revenue growth, (low) price volatility and profit margins, which might indicate a quality stock.
To avoid speculative stocks, we only include companies with a market cap of more than $1 billion. We filtered out stocks that have been listed on the ASX for less than 5 years to better compare historical data.
Again, this doesn't mean these are the best ASX stocks for you or your personal situation. Always do your own research and chat with a professional when in doubt.
The algorithm was last updated 1 December 2023.
Our proprietary algorithm rates ASX-listed stocks based on price performance, profit, revenue and dividends. For more information about our methodology, head to our stock rating methodology page. The companies displayed on this page may not be the best for you and you're encouraged to do your own research. Investments can go up and down and we do not guarantee the performance or returns of any investment.
5: Infratil Ltd
7: Red 5 Ltd
Important: The standard brokerage fee displayed is the trade cost for new customers to purchase $1,000 of either Australian or US shares. Where a platform charges different fees for both US and Australian shares we show the lower of the two. Where both CHESS sponsored and custodian shares are offered, we display the cheapest option.
There's no single winning strategy to filter "good stocks" because the most important consideration is your own circumstances. Besides, the best ASX stocks are those that perform well in the future. And if the last few years has taught us anything, markets can defy expectations.
But that doesn't mean you shouldn't do your homework. Whether you care more about short-term capital gains or long-term dividend growth, it's important to know whether a stock is performing well, making a profit, paying dividends or going backwards.
Michael Gable
Managing Director, Fairmont Equities
I will be focusing on resource stocks in 2023 due to demand for commodities, supply constraints, and a falling US dollar. Gold should also do well, but investors need to remember that it is not a hedge or a long-term investment. You only hold it when the US dollar is falling. That should happen during 2023 but don't fall in love with it, you need to trade it and remain nimble.
The last couple of years have been among the most volatile in history for stocks. It's a market dominated by inflation, interest rate rises and commodity prices going through the roof due to the war in Ukraine.
In fact, it's been a market where investors are actually looking for bad economic news. A slow-down in GDP, for example or an uplift in unemployment, are all signs that inflation could have peaked.
In the first 3 months of 2023, very little has changed. Inflation continues to be a problem central banks face, (although signs are it's peaking), rates continue to rise, unemployment remains resilient and the war in Ukraine is continue.
Generally speaking, during times of uncertainty, commodities, property and industrials are seen as safe havens for investors. It is not surprising that these sectors have been dominating the market over the last 3 months.
But how you should react to these market conditions varies greatly depending on your strategy. If you are a long-term investor with decades of time left before you want to sell your shares, this market backdrop might mean very little to you.
In fact, you might use it as a time to buy cheap stocks and exchange-traded funds (ETFs), that could be cheap and could improve their prospects during this volatile period.
But for others, including older Aussies who need the money right now, more active traders and those who have cash on the sideline, they might be watching the market backdrop more closely than those who are buying and holding.
Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, options or any specific provider, service or offering. It should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involve substantial risk of loss and therefore are not appropriate for all investors. Past performance is not an indication of future results. Consider your own circumstances and obtain your own advice before making any trades.
Image source: Getty
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