It’s always an exciting time when new investors become interested in the stock market. By taking control of your finances, you give yourself a chance to become comfortable in retirement. However, it can be difficult to choose which stocks to hold in a portfolio. I believe that new investors should keep it simply by investing in companies they’re familiar with and businesses they can understand. In this article, I’ll discuss three stocks you should consider buying as a new investor.
Buy one of these five companies
In Canada, the financial sector accounts for a large proportion of the stock market. This makes sense when you consider all of the large companies that operate in that area in Canada. The Big Five banks are some of the most well-known companies in the country, providing banking services to Canadians in all provinces. Because of the extraordinary moat that those five companies have established over the years, I believe choosing one of those as your first stock would be a good idea.
If I had to choose one of the Big Five banks, it would be Bank of Nova Scotia (TSX: BNS)(NYSE: BNS). I like this company because of its focus on its international presence. Strategically positioned in the Pacific Alliance, Bank of Nova Scotia is poised for growth. This geographic diversification also provides Bank of Nova Scotia with a buffer, should its North American business be hit by a prolonged period of economic uncertainty.
This is one of the most recognized names in Canada
Canadian National Railway (TSX: CNR)(NYSE: CNI) is another company that Canadians should be very familiar with. It operates 33,000 km of track which spans from British Columbia to Nova Scotia. Canadian National’s rail network also reaches as far south as Louisiana.
What’s interesting about railway companies is that they continue to play an important role in the Canadian economy. Currently, there isn’t a viable way to transport large amounts of goods over long distances, if not via rail. As the leader of the Canadian railway industry, Canadian National could continue to see a lot of demand in the coming years.
Canadian National is also known as a Canadian Dividend Aristocrat. This is because it has managed to increase its dividend distribution for at least five consecutive years. In fact, it is one of only 11 TSX-listed companies to hold a dividend-growth streak of at least 25 years. This is truly an elite Canadian company.
A large company that dominates two industries
Finally, new investors should consider buying shares of Telus (TSX: T)(NYSE: TU). This company operates the largest telecom network in the country, providing coverage to 99% of the Canadian population. Although Telus’s presence in the telecom network is as massive as it is, that’s not the only aspect of its business that investors should pay attention to.
Over the years, Telus has emerged into a legitimate contender in the healthcare industry. It offers a variety of solutions to healthcare professionals. Telus also has its MyCare app, which allows users to seek out medical professionals from the comfort of their own homes. This could make Telus a major player in the emerging telehealth industry.
