Whilst I am a massive fan of Australian small-cap shares, I don't believe that investors should go all-in on them.
Traditionally small-cap shares carry greater investment risks than their larger rivals, therefore I feel it would be prudent for investors to diversify their portfolio by investing in a number of blue chip shares as well.
Three blue chips which I would buy today are as follows:
Ramsay Health Care Limited (ASX: RHC)
I believe this private hospital operator is the perfect buy and hold investment. Due to ageing populations across the world, an increase in chronic disease burden, and improvements in treatment and diagnostic methods, I believe Ramsay is positioned perfectly to provide investors with above average earnings growth. Especially if its much-speculated expansion into the Chinese market becomes a reality.
SEEK Limited (ASX: SEK)
Seek may be Australia's largest jobs portal, but it also has a growing presence in other key markets across the world. Especially in China through its majority holding in Zhaopin. As the number one online jobs classified site in China, I believe that Zhaopin has enormous potential and will be a key growth engine in the future for Seek. Like Ramsay, Seek strikes me as being a great buy and hold investment option.
Treasury Wine Estates Ltd (ASX: TWE)
In FY 2016 this global wine giant grew net profit by a staggering 131%. Whilst I don't expect another result like that this year, I do believe that thanks to organic growth, currency tailwinds, and the acquisition of the Sterling Vineyards, Beaulieu Vineyard, and Blossom Hill brands, Treasury Wine Estates should be in a position to grow earnings at a strong rate. This should more than justify paying 30x trailing earnings to own its shares today.
