Experience is one of the greatest teachers a person can have. It teaches you things no book or knowledge might, and it has the potential to burn the right lessons into your mind. It’s one of the reasons why many seasoned and experienced investors prefer to stick with tried-and-tested assets that can slowly but surely make them money.
Many young investors, however, look for rapidly growing, exciting assets, and it’s actually not a bad thing, because when you have the luxury of time, you can experiment with risky but promising prospects. But for beginner investors who want to take the safe route, there are several no-brainer buys that can get them started on the investment path.
A reliable dividend stock
Restaurant Brands International (TSX:QSR)(NYSE:QSR), a merger that combined two of the most well-known food chains in North America under one banner (Tim Hortons and Burger King), didn’t become as explosive a success as many initially thought it would. It was a pretty decent growth stock for a while, but it has been struggling ever since the pandemic with both its valuation and its revenues.
Two out of three of its primary brands have been underperforming for a while now, whereas the new addition to the team, Popeyes, gained a lot of momentum during the pandemic. But even if it doesn’t pay off as a growth stock, you can rely upon this aristocrat for dividends. The yield right now is a solid 3.35%, and even though the dividend growth is unflattering, it’s there and can help you with a passive-income stream.
A time-tested growth stock
While venture capital doesn’t have as big a collection of reliable growth stocks, it has a few worth noting, and one of them is StorageVault Canada (TSXV:SVI). It’s a consistent growth stock that has returned well over 500% to its investors in the last five years. The powerful growth has also made SVI quite expensive over the years. Still, the history and consistency of growth, along with its well-established position in a highly competitive market, makes it a no-brainer growth bet nevertheless.
StorageVault’s competitive advantage comes from its consolidation of the self-storage business across the country. It has seven brands under its name and a portfolio consisting of 180 locations (with 88,500 storage units). The storage space business is relatively stable, requires little to no maintenance, and thrives in markets where there is a lot of movement (people changing homes, rental properties, etc.).
A combination of both
If you are looking for a no-brainer stock that offers both capital appreciation potential and dividends, Granite REIT (TSX:GRT.UN) is definitely worth considering. The REIT offers a strong 10-year CAGR of 17.3%, along with a 3.4% dividend yield. And the best part is that it’s not overvalued at all. The growth is supported by stable financials, and the long-term holding potential of Granite comes from its diversified portfolio.
The REIT has a sizeable international presence, and its 115 properties are spread out in seven countries (with most properties in the U.S.). The property mix is a bit concentrated (70% is made up of distribution/e-commerce properties), which is currently one of the most attractive asset classes in the real estate market.
Tried-and-tested stocks might not be as exciting as finding hidden gems or betting on risky long shots to get unbelievable returns. But that’s not a viable long-term investment strategy. You might consider splitting your capital into two segments: one to feed a reliable and stable portfolio for your retirement, and the other, a relatively smaller portion to try risky assets.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends GRANITE REAL ESTATE INVESTMENT TRUST and Restaurant Brands International Inc.