While a $5,000 investment might not sound like much in the grand scheme of things, depending on your investment time horizon an annual investment of $5,000 could one day grow to be very significant.
According to research by Fidelity, Australian shares have provided investors with an average return of 9.1% per annum over the last 30 years
Should the market provide the same average annual return in the future, a once a year $5,000 investment in the local share market for 30 years would grow to be worth over $750,000.
Whilst investors could consider using an index fund, they could potentially find superior returns by investing the $5,000 in some high quality blue chip shares with strong growth potential.
Here are four shares I would consider investing this money into:
a2 Milk Company Ltd (Australia) (ASX: A2M)
Demand for a2 Milk's infant formula from Chinese consumers continues to grow at an incredible rate. This demand led the company to upgrade its full-year guidance for the second time in two months last week. Whilst it shares are by no means cheap now, I believe the premium is justified based on its current outlook.
CSL Limited (ASX: CSL)
I believe the biotherapeutics giant could be a great long-term buy and hold investment. Thanks to its industry leading immunoglobulins business and fledgling influenza vaccine business, I believe CSL is capable of delivering above-average earnings growth for at least the next decade.
Ramsay Health Care Limited (ASX: RHC)
This private hospital operator could be my favourite buy and hold investment option on the local share market. Thanks to its global footprint, I believe Ramsay is positioned perfectly to profit from ageing populations and increased chronic disease burden across the world.
Webjet Limited (ASX: WEB)
In the first-half of FY 2017 this leading online travel agent reported a whopping 96% jump in net profit after tax thanks to the strong performance of all of its businesses. Not only did all its key segments post an increase in bookings growth, they also increased their respective market share. I expect more of the same moving forward.
