It’s completely understandable to feel anxious in today’s volatile market. Canadian investors have endured extreme price swings over the past six months. Year to date, the S&P/TSX Composite Index is now down just about 10%.
It’s far easier said than done to buy low and sell high. And with no shortage of high-quality TSX stocks trading at massive discounts, it’s incredibly tempting to put as much money into the market as possible today. But as opportunistic as these discounts may be, the worst may be yet to come.
Don’t get me wrong; as a long-term investor myself, I’ve been putting money to work in the stock market consistently throughout 2022. Just because I’m banking on more volatility and selling in the near term doesn’t mean I’m going to be waiting patiently on the sidelines. Regardless of the market’s condition, I’ll always continue to set aside money for investing in the stock market — that is, as long as I’m able to hold my positions for the long term.
Image source: Getty Images
Investing in a volatile market
It’s not easy watching your portfolio drop in value, despite continuously adding funds to it. And I’m speaking from experience this year. What keeps me optimistic is knowing that I’m investing in solid companies that I truly believe will come out of this market downturn with an even stronger market position.
Having a long-term mindset allows me to overlook the short-term uncertainty in the stock market. Instead, I can focus on finding high-quality businesses to add to my investment portfolio. And fortunately, there are plenty of great companies trading at bargain prices right now.
I’ve reviewed a top TSX stock that any type of long-term Canadian investor would be wise to have on their radar. Market-beating growth and diversification are two reasons why the company is on my own watch list. But even passive-income investors would be interested in this dividend-paying company.
Brookfield Asset Management
At a market cap nearing $100 billion, Brookfield Asset Management (TSX:BAM.A) is one of the largest stocks on the TSX. The asset manager boasts a well-diversified portfolio of assets as well as an international presence.
The diversification that this TSX stock can provide a portfolio is second to none. That’s why I’d argue most Canadian investors would be better off with this company in their portfolio than not.
If you feel like you’re over-indexed towards one or two areas of the market, Brookfield Asset Management is the perfect company to own to help balance that out.
Despite the diversified business, though, this TSX stock has an impeccable track record of delivering market-beating gains. Shares of Brookfield Asset Management have nearly doubled the returns of the Canadian stock market over the past five years. And that’s not even including the stock’s nearly 1.5% dividend yield, either.
Foolish bottom line
It’s perfectly normal to feel flustered in today’s volatile market. Just keep in mind that volatility and even a potential upcoming recession are not reasons for long-term investors to be on the sidelines today.
Having a long time horizon allows investors to patiently wait for the market to rebound, which it eventually will. In the meantime, I’d suggest keeping an updated watch list, as there are too many great opportunities on the TSX to pass up right now.
