3 TSX Stocks to Create a Perfect Investing Base

If you need TSX stocks to go back to again and again, these are three perfect options I would consider as a solid base for your portfolio.

| More on:
A worker drinks out of a mug in an office.

Source: Getty Images

Investors likely already know that they should never put all their cash in one place. It’s never a smart idea to look at TSX stocks, choose one, and put everything into that one option. What happens if it falls?

Even exchange-traded funds (ETF) can go through this, so creating a diverse portfolio is definitely a smart move. However, there is certainly something to say for having a few base TSX stocks to make up your portfolio — ones you can safely invest in as the years go on, leaving a smaller percentage for riskier investments.

Here are the top three TSX stocks I would consider a great place to start your base.

Vanguard Balanced Portfolio

You’ve likely heard about the benefits of holding bonds during a downturn. But after a downturn, bonds aren’t necessarily your best option. That’s what I like Vanguard Balanced ETF Portfolio (TSX:VBAL). VBAL has 60% of its investments in equities, with 39% in bonds as of writing. So, you already get literally a balanced approach to your investments.

From there, the company invests 18.38% in United States bonds, and most of the rest of its investments actually go towards other Vanguard products. So, it’s not just that you’re getting a diverse set of assets managed by portfolio managers. You’re getting several diverse sets of assets, each managed by a team of professionals looking out for your best interest.

Plus, VBAL ETF also has a 2.82% dividend yield right now you can bring in, so you’ll be seeing fixed income at a great price month after month. Shares are down just 1.4% right now to get a great deal.

Royal Bank

If you’ve already got an ETF or two, then a Big Six bank is a great option to consider. Of these, Royal Bank of Canada (TSX:RY) is a strong investment option. The bank continues to be the largest of the Big Six banks by market capitalization, and to expand operations by entering emerging markets.

Yet it’s the wealth and commercial management sector that continues to be the support for Royal Bank stock. It manages to bring in highly lucrative clients that should see the company withstand any problems for decades to come.

Meanwhile, Royal Bank stock trades up 4.41% in the last year compared to other banks, though it’s still a deal trading at 13.04 times earnings. You can also bring in a dividend yield at 3.87% as well when you pick it up today.

Canadian Utilities

If you’re looking to build more in passive income from TSX stocks, then I would head straight towards Canadian Utilities (TSX:CU). Canadian Utilities stock is currently the only stock on the TSX today that’s a Dividend King. That means it’s increased its dividend each year for the last 50 years!

If you want consistency, this is certainly one of the TSX stocks to consider. Utilities are also a safe choice given that we need them no matter what the market does. It powers our lives, and it therefore makes it easy for the company to continue bringing in revenue and expand through acquisitions.

Canadian Utilities stock is just outside of value range trading at 17.14 times earnings, offering a dividend yield at 5.04% as of writing. Shares are up 2.3% in the last year after coming down at the end of last year.

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 Amy Legate-Wolfe has positions in Royal Bank Of Canada. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Dividend Stocks

A close up image of Canadian $20 Dollar bills
Dividend Stocks

2 TSX Dividend Stocks With Yields Above 7% That You Can Buy With $100

Here are two high-yielding TSX dividend stocks you can buy with less than $100 per share today and hold for…

Read more »

oil and gas pipeline
Dividend Stocks

Should You Buy Enbridge Stock on a Pullback?

Down 25% from all-time highs, Enbridge stock remains a top investment choice due to its diversified business and steady cash…

Read more »

Redwood trees stretch up to the sunlight.
Dividend Stocks

2 Fantastic Growth Stocks to Buy Right Now

These two growth stocks aren't your average growth stocks, as shares rise higher and higher after earnings, and more's to…

Read more »

Businessmen teamwork brainstorming meeting.
Dividend Stocks

1 Magnificent Dividend Stock Down 15% to Buy and Hold Forever

Enbridge is off the 12-month lows but still trades at a large discount to its 2022 high.

Read more »

Increasing yield
Dividend Stocks

My Top 5 Ultra-High-Yield Dividend Stocks to Buy in May

If you’re looking to build a passive-income stream, these five dividend stocks should be on your radar.

Read more »

Payday ringed on a calendar
Dividend Stocks

A 10.6% Dividend Stock That Provides Monthly Cash Payments

A dividend stock with a mouth-watering yield providing monthly cash flow streams.

Read more »

Dividend Stocks

The Top Canadian REITs to Buy in May 2024

These three REITs have envious growth potential and trade cheaply today, making them three of the top Canadian stocks to…

Read more »

Young woman sat at laptop by a window

Why I Can’t Stop Buying Shares of This Magnificent High-Yield Stock in My Retirement Account

This utility is an excellent retirement stock, providing juicy income, income growth, and wealth creation for the long haul!

Read more »