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

The latest Westpac Banking Corp (ASX: WBC) Weekly economic report once again forecasts the cash rate remaining on hold at 1.5% until at least December 2020.

If this forecast is accurate, it means at least another two years of paltry interest rates on savings accounts and term deposits.

Because of this, if I had $10,000 in a savings account, I would consider putting it to work in the share market.

Three shares that I would look at investing these funds into are listed below. Here’s why I like them:

A2 Milk Company Ltd (ASX: A2M)

This infant formula and dairy company could be a great buy and hold investment thanks to the growing demand for its products across the world. Last week the company released a positive trading update which revealed that its share of the Australian fresh milk and Chinese infant formula markets had continued to grow over the last quarter. This led to Goldman Sachs retaining its buy rating and $12.20 price target on the company’s shares. This price target implies potential upside of 29% over the next 12 months.

REA Group Limited (ASX: REA)

I think that this property listings company could be a great option for investors, especially after its shares pulled back significantly in recent weeks. Concerns over falling house prices and a disappointing trading update from rival Domain Holdings Australia Ltd (ASX: DHG) means that REA Group’s shares have fallen 24% since peaking at $94.12 in August. I think this selloff has been overdone and feel REA Group can continue to grow in these challenging conditions thanks to its depth penetration, international exposure, pricing power, and the launch of new products.

Rural Funds Group (ASX: RFF)

If you’re interested in earning income from your $10,000 investment then I think Rural Funds could be a great option. Rural Funds is a real estate investment trust with a focus on agricultural assets. It has a diverse and quality portfolio comprising 44 properties across six different agricultural sectors. The properties have a weighted average lease expiry of 12.3 years, providing income stability and long-term rental growth via a mix of indexation mechanisms. This year management plans to pay a distribution of 10.43 cents per unit, equating to a forward yield of 4.9%.

Looking for more ideas for that $10,000? Then check out these mid cap growth stars.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended REA Group Limited. 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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