3 No-Brainer Stocks to Buy With $500 Today

The market is full of great long-term options to buy right now. Here’s a trio of no-brainer stocks to build your portfolio.

| More on:

Building out a well-diversified portfolio takes time. It also requires investors to focus on long-term potential over short-term volatility. When that market volatility does hit, it exposes some stellar opportunities to buy stocks at a discount. This includes some no-brainer stocks that investors can buy with just $500 today.

Curious? Here’s a look at those no-brainer stocks to buy today.

bulb idea thinking

Image source: Getty Images

Opportunities are everywhere if you know where to look

One of the hallmarks of every well-diversified portfolio is one or more defensive stocks that can weather volatility. And that’s precisely why the first of several no-brainer stocks is Fortis (TSX:FTS).

For those who are unfamiliar with the stock, Fortis is one of the largest utilities in North America. The overwhelming majority of Fortis’s business stems from long-term regulated contracts, which often span decades in duration.

Those regulated contracts provide Fortis with a recurring and stable source of revenue. That stability allows forces to reinvest in growth and provide investors with a growing attractive dividend.

As of the time of writing, that dividend works out to a yield of 4%. Prospective investors should keep in mind that Fortis has provided annual upticks to that dividend for half a century without fail.

But what exactly makes Fortis one of the no-brainer stocks for your portfolio? Apart from its defensive appeal and juicy dividend, Fortis benefits from trading at a discount right now. Over the trailing 12 months, Fortis remained relatively flat, making it a superb time to pick up at a discount.

Banking on recovery and growth

You can’t compile a list of no-brainer stocks and not mention at least one of Canada’s big banks. And that bank to consider right now is Canadian Imperial Bank of Commerce (TSX:CM).

CIBC isn’t the largest of the big banks. In fact, it’s on the smaller side. The smaller size means CIBC has focused on its domestic mortgage book rather than international expansion. And with interest rates rising, the stock has been under pressure due to that interest rate risk.

As of the time of writing, the stock is down over 12% in the past year, making it an ideal, if not discounted, option for long-term investors.

That drop has also swelled CIBC’s dividend, which now boasts a yield of 6.26%, making it the highest among its big bank peers. And like Fortis, CIBC has provided investors with an annual uptick to that dividend going back years.

Prospective investors should keep in mind one final point that makes CIBC one of the no-brainer stocks to buy. Canada’s banks have fared significantly better than their U.S. counterparts during times of volatility.

In other words, the drop in stock price should be seen as one of opportunity.

Pickup an everyday stock that you cannot go wrong with

Some of the best investments to add to your portfolio are what I like to call everyday stocks. These are stocks that perform a necessary function and that we interact with on a daily basis.

A great example of this is a grocer like Metro (TSX:MRU).

Metro is one of the largest grocers in Canada. The company has a network of 975 grocery stores and a pharmacy network with 645 locations, most of which are focused on Quebec and Ontario.

But why is Metro one of the no-brainer stocks for your portfolio?

Apart from the defensive necessity it offers, Metro is also a great growth pick. The company has outperformed the market over the trailing five-year period, with gains of over 75%.

Turning to income, Metro offers a respectable quarterly dividend. As of the time of writing, Metro’s dividend works out to 1.62%, and the company has provided annual upticks for nearly three decades.

In short, Metro is a no-brainer stock for any well-diversified portfolio.

The no-brainer stocks to buy for $500

No investment is without risk, and establishing a portfolio takes time. The three stocks mentioned above all boast some defensive appeal as well as growth and income-producing capabilities.

And with a $500 investment in each, prospective investors can kickstart what could be a well-diversified, long-term portfolio.

Fool contributor Demetris Afxentiou has positions in Fortis. The Motley Fool recommends Fortis. The Motley Fool has a disclosure policy.

More on Dividend Stocks

runner checks her biodata on smartwatch
Dividend Stocks

A Perfect March TFSA With a 3.1% Monthly Payout

This Canadian stock combines monthly income with long-term growth in the booming energy sector.

Read more »

Bank of Canada Governor Tiff Macklem
Dividend Stocks

Interest Rates Aren’t Falling: Here’s What I’d Do With My TFSA

Here's how higher interest rates impact Canadian stocks and how to position your TFSA in the current environment.

Read more »

chatting concept
Dividend Stocks

3 Blue-Chip Dividend Stocks for Canadian Investors

Looking for growing income and steady growth? These Canadian blue-chip stocks are best in class and long-term value creators.

Read more »

shoppers in an indoor mall
Dividend Stocks

A 5.7%-Yielding TFSA Pick That Pays Consistent Cash

Investors looking for an income pick in a TFSA can consider buying this stock on dips.

Read more »

Canadian dollars are printed
Dividend Stocks

Transform Your TFSA Into a Cash-Creating Machine With $10,000

These leading Canadian dividend stocks have the potential to transform a TFSA into a cash-creating investment vehicle.

Read more »

Couple working on laptops at home and fist bumping
Dividend Stocks

TFSA Investors: 1 “Set-it-and-Forget-it” Stock for 2026

This "set-it-and-forget-it" stock for the TFSA today offers a rare combination of discounted valuation, income, and high growth potential.

Read more »

dividend stocks are a good way to earn passive income
Dividend Stocks

My 3 Favourite Canadian Stocks for Passive Income

These three stocks offer a simple way to build reliable passive income over time.

Read more »

woman gazes forward out window to future
Dividend Stocks

How to Create Your Own Pension With Dividend Stocks

Find out important information about pensions, focusing on the Canada Pension Plan and how it impacts your retirement.

Read more »