February 3, 2023

Invest like Warren Buffett with these ASX shares

One of the world’s most famous investors is Warren Buffett.

Over several decades, through his Berkshire Hathaway business, the Oracle of Omaha has delivered stunning returns for investors.

The good news is that Buffett has achieved these feats without any fancy high frequency trading strategy. Instead, he has made long term investments in high quality companies and let compounding work its magic.

The even better news is that there’s nothing to stop you from following Buffett’s investment style to grow your own wealth.

But which ASX shares could be Buffett-style investments right now? Two that tick a lot of boxes are listed below. Here’s what you need to know about them:

Transurban Group (ASX: TCL)

One quality that Buffett looks for when making investments is a competitive advantage or moat. This is something that this toll road operator has with its portfolio of key assets across Australia and North America. If you want to drive across Melbourne and Sydney quickly, you’re probably going to have to use its roads. In fact, the company estimates that customers using Transurban roads (compared to alternative routes) saved a total of 323,000 hours of travel time each workday in FY 2022.

Citi is a fan of Transurban and has a buy rating and $15.70 price target on its shares. Its analysts are also forecasting consistent dividend growth through to FY 2025, which is likely to go down well with an investor like Warren Buffett.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

Another (simple) way to invest like Buffett is to buy the VanEck Vectors Morningstar Wide Moat ETF. This is a Warren Buffett-inspired ETF that gives investors access to a diversified portfolio of companies with sustainable competitive advantages and fair valuations. At present, its holdings include businesses with strong moats such as Amazon, Intel, Microsoft, and Walt Disney.

Over the last 10 years, the index that the fund tracks has beaten the market with a total average return of 18.11% per annum. This would have turned a $10,000 investment into over $50,000.

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