The S&P/TSX Composite Index is sitting at a loss of more than 10% on the year. It’s the added volatility, though, that has really made 2022 difficult to bear.
There’s no sugar-coating it; it’s been one heck of a tough year for investors. Even worse, the end doesn’t look like its anywhere near in sight. But despite all the negativity in the stock market today, now is not the time to be selling if you’ve got a long-term horizon.
Investing during a bear market
It’s easier said than done to remain calm during market downturns. I’ll speak from first-hand experience: it’s incredibly deflating to see your portfolio diminish in size, despite continuing to add more funds to it on a consistent basis.
Having a long-term horizon is what allows me to stay motivated to keep investing each month. Rather than worry about how the market performs on a day-to-day basis, my focus today is on finding top-quality businesses to invest in. I’m looking for TSX stocks that will not only be able to weather these tough market conditions but come out of them even stronger.
It may take time, but I have the utmost confidence in the stock market to eventually rebound and begin its climb back up to all-time highs. And while we wait, I’m going to continue investing in companies that I believe will be long-term winners.
I’ve reviewed two companies that I own which I’ve added to more than once already this year. And with shares still trading at opportunistic discounts, I may be adding to them again before the end of the year.
TSX stock #1: Brookfield Renewable Partners
The long-term tailwinds for the renewable energy sector are evident. Green energy stocks across Canada have witnessed market-beating growth in recent years, and I’m not expecting that to change anytime soon.
At a market cap just shy of $30 billion, Brookfield Renewable Partners (TSX:BEP.UN)(NYSE:BEP) is not only a Canadian renewable energy leader but a global one too. The company has operations spread across the globe, offering its customers a range of different green energy solutions.
Shares of the TSX stock are up nearly 100% over the past five years, which is good enough for more than doubling the returns of the broader Canadian market. And that’s not even including the company’s impressive dividend, which is currently yielding more than 3.5%.
Alongside many of its peers, Brookfield Renewable Partners is trading at a discount. Shares are down close to 30% from all-time highs set in early 2021.
If you’re bullish on renewable energy, now would be a wise time to invest in Brookfield Renewable Partners.
TSX stock #2: Shopify
Growth investors do not want to miss a buying opportunity like this. Shopify (TSX:SHOP)(NYSE:SHOP) has seen its stock drop 70% over the past 12 months and is now trading more than 80% below all-time highs.
The business has struggled after seeing a surge in demand during the early days of the pandemic. Management has been transparent about the fact that it misjudged the pandemic’s short-lived boost in activity and is now rightfully paying the price for it.
These are short-term pains for a company with loads of growth still ahead of it. Shopify remains a leader the e-commerce space, which only continues to grow.
If you’re comfortable with the volatility, this is a growth stock that you’ll be thanking yourself in a couple of years’ time for taking a chance on it.
