According to the latest ASX 30-Day Interbank Cash Rate Futures contract, the market is now pricing in a 99% probability of a cash rate decrease to 1.25% at next week's Reserve Bank of Australia meeting. After which, the market yield curve is implying a cut to 1% by October and a strong probability of a further cut next year.
In light of this, if I had $10,000 sitting in a bank account gathering only paltry interest, I would consider putting it to work in the share market instead.
Three shares that I think would be great options are listed below:
Bravura Solutions Ltd (ASX: BVS)
I think that this fintech company would be a great place to invest $10,000 with a long-term view. Bravura Solutions is a provider of software products and services to the wealth management and funds administration industries and has been growing at an impressive rate over the last few years. Pleasingly, thanks to potential earnings accretive acquisitions and its increasingly popular Sonata wealth management platform, I believe the company is well-positioned to continue this strong form for many years to come.
Super Retail Group Ltd (ASX: SUL)
If you're looking for a combination of value and income then Super Retail could be a good option. It is the retail group behind brands including Rebel, Supercheap Auto, and Macpac. It has been performing very well in FY19, despite the retail sector experiencing tough trading conditions. If consumer sentiment and spending picks up following the election, then Super Retail could see its earnings growth accelerate in FY20. This may allow the company's board to increase its dividend, which currently provides a trailing fully franked 5.3% yield.
Xero Limited (ASX: XRO)
One of my favourite buy and hold options in the tech sector is Xero. The cloud-based business and accounting software provider has been growing at a very strong rate over the last few years and FY19 was no exception. Earlier this month, Xero released its full-year results and revealed a 36% increase in operating revenue to NZ$552.8 million. In addition to this, at the end of the period the company's annualised monthly recurring revenue (AMRR) had grown 32% to NZ$638.2 million and its total subscriber lifetime value (LTV) had lifted 36% to NZ$4.4 billion. Due to the quality and stickiness of its product and its global market opportunity, I expect more of the same over the medium term.
