Canadian investors have witnessed an extremely volatile year to date. The S&P/TSX Composite Index managed to drop more than 35% in just over one month. The index rebounded by surging almost 15% in April.
The April surge can partly be attributed to the optimism surrounding the COVID-19 pandemic and strong governmental support. The stock market is forward-thinking and Canadian investors believe that there is light at the end of the tunnel with regards to the pandemic.
Canadians are also responding positively to the government’s support to help individuals and businesses in need.
There is plenty of optimism in the market today, but the record levels of volatility might not yet be behind us. High levels of volatility are no reason to not be investing in TSX stocks, however.
If you’re trying to time the market and get in at the lowest price, good luck. The Foolish way of investing is all about buying great companies and holding them for the long term.
There are plenty of great Canadian companies now trading well below all-time highs. Let’s take a deeper look at two of those companies that investors would be wise to buy at these prices.
TD Bank
The $100 billion bank is the second-largest bank in the country based on market cap size. Toronto-Dominion Bank (TSX: TD)(NYSE: TD) is down more than 20% from the beginning of 2020.
Bank stocks were among the hardest hit during the last recession just over a decade ago. Investors need to keep in mind that that recession was driven by very different causes than what’s driving the economic downturn today.
Banks are also in much better shape today to cope with the decline in business. Many banks are increasing the amount of cash in its reserve to avoid a repeat of what happened during the last recession.
TD bank may be a $100 billion company, but there is still plenty of growth left ahead for the company.
The bank operates more than 2,000 retail locations spread across North America, and roughly 30% of net income is driven from the U.S. The majority of American locations are on the east coast today, leaving plenty of opportunities to grow in the west.
The bank pays a very strong dividend at $3.16 per share. That’s equal to a yield of more than 5% at today’s stock price. And at a dividend-paying streak of more than 160 years, shareholders can remain confident even during the worst of economic conditions that they’ll be receiving a dividend payment.
Brookfield Asset Management
Brookfield Asset Management (TSX:BAM.A)(NYSE: BAM) is among the most diversified TSX stocks you’ll find. Not only is the $70 billion company diversified in asset type, but geographically as well.
The company owns assets in private equity, infrastructure, renewable power, and real estate. The asset manager also operates in more than 30 countries across the globe.
Brookfield Asset Management is an excellent company to add in any Canadian’s portfolio to drive not only long-term growth, but stability as well. The asset manager has largely outperformed the TSX Index for the last one, three, and five years, and there’s no reason to believe that trend will not continue.
While the dividend might not be as attractive as that of TD Bank, it’s still a respectable yield of 1.45% today.
Foolish bottom line
Both companies are top TSX stocks that are down significantly from all-time highs. Although each owns a very large market cap size, there is still plenty of growth ahead for both companies.
Investors should not be intimidated by the volatility happening in the market today. Buying great companies and holding for the long-term is what lets investors sleep well at night. Lucky for us, there are lots of great companies trading at a discount today.
