Where I would invest $20,000 in the share market

Next week the Reserve Bank of Australia will meet to decide on the cash rate once again.

I don’t believe there is a single economist or analyst that expects a rate rise in April, nor are there many that expect one at any point in 2018.

Because of this, if I had $20,000 sitting in a low interest savings account I would consider putting it to work in the share market.

Three shares which I believe could generate strong returns over the next 12 months are listed below. Here’s why I like them:

Cochlear Limited (ASX: COH)

As the global population grows older I expect this hearing solutions company to benefit from increasing demand for its products. Especially given the fact that its products are generally regarded as being among the best in the industry. This could put Cochlear in a position to continue delivering above-average profit growth for a long time to come. Although its shares are a little expensive after a strong run over the last 12 months, I expect in the long-term they will justify this premium.

Corporate Travel Management Ltd (ASX: CTD)

One of the highlights of earnings season in my opinion was the half-year result of Corporate Travel Management. For the first-half of FY 2018 the company reported a 33% increase in underlying half-year net profit on the prior corresponding period to $36.4 million. Although its shares have pushed higher since the release, I believe they are still good value at 31x estimated forward earnings given the company’s positive long-term growth prospects.

Westpac Banking Corp (ASX: WBC)

Although in the short term I think the Royal Commission could hold this banking giant’s shares back, if, as I expect, no skeletons are found in its closet then I think they could motor higher again. At the current price Westpac’s shares provide a trailing fully franked 6.5% dividend. This arguably makes the bank a perfect mix of both value and income for investors.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited. The Motley Fool Australia has recommended Cochlear Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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