Where I would invest $10,000 in the share market

Later this morning the Australian Bureau of Statistics will release the second quarter CPI reading.

Unless there’s a big surprise in the data, the market isn’t expecting inflation to be anywhere near strong enough to make the Reserve Bank of Australia change its outlook on interest rates.

As such, there isn’t likely to be an end to low interest rates any time soon.

Because of this, I think investors would be better off skipping savings accounts and term deposits in favour of the share market.

After all, the All Ordinaries (Index: ^AXAO) (ASX: XAO) is up 10% since this time last year.

If I had $10,000 to invest in the share market this month I would choose one of these shares:

Bellamy’s Australia Ltd (ASX: BAL)

I think that this organic infant formula company’s shares are changing hands at an attractive level after a recent pullback. This share price decline has been caused by concerns that the CFDA accreditation it requires to sell Chinese labelled products in the massive market could be delayed for a few months. While this would be a disappointment and is likely to mean its earnings growth in FY 2019 won’t be as strong as previously expected, I believe its long-term prospects are still as bright as ever. So at 21x estimated FY 2019 earnings, I think it would be a great time to pick up shares with a long-term view.

Experience Co Ltd (ASX: EXP)

Another company that has seen its share price tumble lower recently is Experience Co. The adventure tourism company is set to deliver an underwhelming result in FY 2018 after a once-in-a-generation weather event impacted many of its businesses. I believe the selloff has been a bit of an overreaction and expect the company to leverage the tourism boom and deliver a much stronger result in FY 2019, weather permitting.


In May this data centre operator announced the purchase of three new commercial property sites for future facilities in Sydney, Melbourne, and Perth. Once these are constructed the company will have a network of 11 world class data centres throughout Australia with a planned total capacity of 300 megawatts. I believe this has put NEXTDC in a position to grow at a strong rate over the next decade as the growth of the cloud computing market accelerates. This growth was evident earlier this week when the revenue of Microsoft’s Azure cloud business almost doubled in the last quarter. Though, it is worth noting that NEXTDC’s shares change hands on a sky-high earnings multiple, meaning there is significant downside risk if its earnings growth underwhelms.

And if you're lucky enough to have even more funds to invest then I would suggest you consider these top four shares which have been kicking goals this year.

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Motley Fool contributor James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia owns shares of EXPERNCECO FPO. 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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