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Where should you invest your first $1,000?

James Mickleboro
Businessman paying Australian money

Although $1,000 may not seem like a life-changing sum of money to invest, if you are able to do it periodically over a long enough time frame, it could grow materially.

For example, over the last 30 years the Australian share market has provided a return of 9.1% per annum on average.

Based on this, if you had invested $1,000 every second month, bringing your total annual investment to $6,000, your investments would have grown to be worth approximately $910,000 today if you achieved the market return.

With that in mind, here are two shares that I think would be great options for that first $1,000 investment:

Altium Limited (ASX: ALU)

Altium is an electronic design software company. It is the company behind the hugely popular Altium Designer product. This is an award-winning printed circuit board (PCBs) design platform which has experienced a meteoric rise in user numbers in recent years thanks to the Internet of Things (IoT) boom. The good news is that research firm Statista is forecasting the IoT market to be worth US$1.6 trillion in 2025. This will be up materially from an estimated US$212 billion in 2019. Given how most IoT devices have PCBs inside them, I believe this will lead to increasing demand for Altium Designer and underpin strong earnings growth over the next decade. 

Appen Ltd (ASX: APX)

Another option for your $1,000 investment is Appen. It is the global leader in the development of high-quality, human annotated datasets for machine learning and artificial intelligence. Thanks to its one million plus on-demand global crowd, the company is able to provide or improve data to be used in machine learning and artificial intelligence product development. Demand for its services has been incredibly strong in recent years, leading to management guiding to underlying EBITDA growth of 34.6% to 38.8% in FY 2019. And with the strong demand for its Content Relevance services showing no signs of easing, I am confident FY 2020 will be another year of strong growth.

The post Where should you invest your first $1,000? appeared first on Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Altium and Appen 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.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2020