Rather than leaving a spare $5,000 sitting in a bank account, I would suggest investors put their money to work in the share market.
After all, as small an investment as it might seem, on a long enough time horizon a $5,000 investment can grow into something significant.
According to Fidelity, the Australian share market has provided an average annual return of 9.2% in the 30-year period between 1990 and 2020. That means a single $5,000 investment in 1990 would have grown to be worth a massive $70,000 today.
With that in mind, here's where I would invest $5,000 today:
a2 Milk Company Ltd (ASX: A2M)
Demand for a2 Milk's infant formula from Chinese consumers has been growing at a rapid rate in recent years. This has led to the infant formula and fresh milk company delivering stellar earnings growth. And while its growth is likely to moderate in the coming years, I still expect it to be at a level that most companies would be envious of. Especially given its modest market share in China and expanding fresh milk footprint. Furthermore, the company could accelerate its growth inorganically if it chooses to put its hefty cash balance to work. There is speculation it could make an acquisition or launch a new product in the near term.
Ramsay Health Care Limited (ASX: RHC)
I think this private hospital operator would be a fantastic buy and hold investment option. Although trading conditions are admittedly tough at present and its growth is likely to be subdued in the near term, I'm very positive on its longer term outlook. This is because, as the global population ages, I believe demand for healthcare services will increase substantially. I feel this puts Ramsay and its expansive global network of private hospitals in a strong position to deliver solid earnings growth for decades to come.
