Thanks to the IRS recognizing Canadian registered accounts, especially the RRSP, you can buy and hold U.S. stocks in your portfolio and enjoy similar tax benefits to holding Canadian stocks. And if you’re open to investing in U.S. companies, you will have access to a much larger and more potent pool of investment assets (stocks) to choose from.
More options can help you build a diversified, powerful portfolio, and three U.S. companies deserve to be among the first investments you consider south of the border.
A software giant
Microsoft (NASDAQ:MSFT) is the software giant across the globe. As the creator of the world’s most-used operating system (for personal computers), Microsoft has a distinct advantage in this “ecosystem.” And even though it has lost this position in the mobile market where Android reigns king, it still has a massive user base.
And it’s also growing on other fronts, like through its cloud computing service Azure, which has the second-largest share of the global cloud market after Amazon.
Thanks to its stable reach and constant evolution as a tech company to keep up with the times, it’s a relatively stable tech investment. This two-trillion USD market-cap giant offers both dividends and powerful capital appreciation potential.
The yield may be low at 0.9%, but it’s over 270% price appreciation in the last five years (which is closer to its typical growth pace) more than makes up for it.
A hardware giant
Tech stocks are perhaps one of the most lucrative asset pools within the U.S. market, and includes some of the most promising companies from around the world. One example would be Taiwan Semiconductor Manufacturing Company (NYSE:TSM), one of the three most prominent companies in Taiwan. It’s also one of the largest semiconductor manufacturers in the world.
The company has an impressive product portfolio with over 12,300 different products for various end-markets, including Internet of Things (IoT) and smartphones. IoT is shaping up to be one of the next most prominent tech frontiers and smartphones is a massive market right now.
TSM offers both dividends and a decent capital appreciation potential. Its performance in the last five years has not been linear, but the returns over the half-decade period have certainly been impressive at 132%. It also offers a much higher yield than Microsoft – 2.2%.
A retail giant
Costco (NASDAQ:COST) has a presence that is concentrated mostly in the U.S., yet it is also counted among one of the largest big-box retailers in the world. It has an incredible portfolio of over 800 warehouses, with 578 in the U.S. alone. It also operates in eleven other markets, but the most impressive international presence is in Canada (107 locations) and Mexico (40 locations).
Its business model, growth, and continued expansion are reason enough to consider this company as a long-term investment, especially when these “traits” are backed by an equally lucrative performance. A sure sign that this retailer will not only endure but also grow, is the fact that the management team keeps $11.2 billion in cash on hand, more than the total debt on the balance sheet. The stock has risen over 250% in the last five years alone and has proven itself to be impressively resilient against market dips.
These three U.S. stocks representing two U.S. and one Taiwanese company are easy, no-brainer buys from the stock markets across the border. Even though all three offer dividends, the primary reason to invest in these companies comes down to their capital appreciation potential.