Beginning to invest is a great step towards building long-term wealth. However, there are so many options – what would be good beginner ASX shares to start with?

I believe that diversification is a very powerful tool that investors can utilise to lower risk without necessarily hurting returns. It's about not putting all of your eggs in one basket.

It's tricky for a beginner to start with diversification because buying an ASX share could mean their entire (starting) portfolio is invested in just one name.

Exchange-traded funds (ETFs) could be a smart move because of how you can buy a whole group of shares in a single transaction. It's like buying a ready-made box of shares rather than individually choosing the shares in the box.

I'll talk about two ETFs that could make good beginner ASX share investments.

Betashares Global Quality Leaders ETF (ASX: QLTY)

There are thousands of businesses on the global share market. This ETF aims to avoid most of them and only invest in the best of the best. It owns 150 global companies outside of Australia, ranked the highest on a quality score.

Being the highest quality doesn't necessarily mean incredible returns every single year, but I do think it gives a good likelihood of solid compounding returns over time.

The four factors that businesses must score well on include return on equity (ROE), debt to capital, cash flow generation ability and earnings stability. In other words, it makes good profit for shareholders, debt levels are low, real cash is flowing through the business (not just accounting profits) and the profit number doesn't usually go backwards.

Currently, that has led to the biggest positions being businesses like Netflix, Costco and Intuit.

In the last three years to 31 March 2025, the QLTY ETF has returned an average of 13.5% per year. Past performance is not a guarantee of future returns, but that's a good return and it has outperformed the S&P/ASX 200 Index (ASX: XJO). The QLTY ETF's valuation looks more appealing after dropping 9% since 14 February 2025.

BetaShares Global Sustainability Leaders ETF (ASX: ETHI)

Some new investors may be looking for beginner ASX shares that are acting ethically and sustainably for the planet and people. This fund is a great way to great businesses trying to do the 'right' thing.

It owns a portfolio of large, global businesses that have been identified as climate leaders and also passed screens to avoid companies with exposure to certain industries deemed as less ethical.

The ETHI ETF is not invested in businesses involved in fossil fuels, gambling, tobacco, weapons, destruction of valuable environments, animal cruelty, concerning chemicals, alcohol production, junk food, payday lending or pornography. There should also not be evidence of human rights violations, and they should have at least one woman on the board of directors.

Some of the businesses that currently pass these screens and are the most significant holdings in the portfolio include Apple, Visa, Nvidia and Mastercard. It has a total of around 200 positions.

Investors looking for good beginner ASX shares will be pleased to know this fund has also performed well – in the three years to 31 March 2025, it returned an average of 13.4%. But, its price looks better after falling 12% from 31 January 2025.