After the September bloodbath for broader markets, investors may wish to revisit their watchlists. Undoubtedly, October may not bring that much in the way of relief for investors as the swoon continues. Higher rates continue to act as gravity on share prices, with the impact hitting some sections (think the utilities and expensive growth plays) harder than others.
Even as rates continue their ascent, it’s not a good time to give up on stocks, especially the tech innovators.
Why?
The continued rise of artificial intelligence (AI), spatial computing (the so-called metaverse), and financial technology could pave the way for some sort of productivity boom. Call it the ship that lifts all ships in the market waters, if you will!
The real question is whether such innovations can drive productivity growth to power growth in spite of higher interest rates. Personally, I think it can. And with that, investors should consider tech stocks as they come in a bit this October 2023.
Let’s take a sneak peek at two stocks (one American and one Canadian) that I think could prove smart bets for Canadian investors looking to add to their tech exposure this fall!
Apple
Apple (NASDAQ: AAPL) is a tech behemoth that I think every Canadian investor should seek to gain exposure to. Undoubtedly, it comprises a large part of the S&P 500 and Nasdaq 100 exchanges already. So, if you own those, you’ve already got skin in the iPhone maker.
As the company moves on from its latest correction, I think it may be a good idea to add to your exposure further. You don’t need an overweight position in the name, but taking a small bite out of the individual shares may help improve your odds of beating the markets by that much more.
Right now, investors are sour on the stock following its iPhone 15 and 15 Pro reveal. With some complaints about overheating iPhones coming in, investors may have the right to be just a bit concerned. However, Apple noted that a software update (and a few bug fixes) could alleviate such issues.
All considered, I view Apple stock as the perfect long-term play for investors as it continues to drag its feet into year-end. At $173 and change per share, shares trade at 29.15 times trailing price to earnings (P/E).
Constellation Software
Constellation Software (TSX: CSU) is a proven market beater that’s just over 3% from its all-time high. It’s been a resilient performer and could continue to be as it continues to execute its prudent merger and acquisition strategy. Indeed, the company knows the small-cap software space very well, and it can continue acquiring its way to greater growth over time.
At writing, the stock is up over 30% year to date and nearly 200% in the last five years. The market cap has grown quite large at $59.1 billion. However, don’t expect growth to stall anytime soon.
