2 All-Weather TSX Stocks to Stay Safer in a Downturn

Have you caught on the wrong end of a market dip and rally? Instead of timing the market, consider all-weather stocks for secure returns.

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The TSX has been volatile since the Bank of Canada started aggressive interest rate hikes in April 2022. Growth phases followed a correction, sometimes 5% and sometimes more than 10%. Tech, airline, and bank stocks have been moving with the market momentum. Many took advantage of this momentum and bought some stocks at the dip and sold them when they rallied. 

Did you also try to make short-term gains from this momentum but got on the opposite side and bought in the rally? Instead of investing in momentum stocks, you can secure returns by investing in all-weather stocks throughout the market downturn. 

What are all-weather stocks? 

All-weather stocks are the ones that have withstood several economic crises and business cycles. Think of it like a pair of sneakers that are good for summer, rain, and snow. The sneakers prevent you from slipping in the snow. At the same time, you are not worried about them getting spoiled in the rain. Just as sneakers can be your any-day choice, all-weather stocks can be your any-day pick. You need not worry about buying them at the dip or the rally. 

You can invest a small amount every month in these stocks and take advantage of dollar-cost averaging. Regular investing removes the stress of timing the market and buying the dip. You invest through all market cycles, reducing your average buying cost and enhancing your long-term return. 

Two TSX all-weather stocks to buy in a downturn

The best way to identify all-weather stocks is by looking at their business model and how they earn income. A low-risk model provides a cushion to the business during a downturn and boosts income during an upturn. Here are two such all-weather stocks you can buy throughout the downturn. 


While other real estate investment trusts (REITs) are suffering from high debt, CT REIT (TSX:CRT.UN) has lower debt ($2.77 billion) than equity ($2.99 billion). Also, its debt has a weighted average maturity of six years, which is longer than the industry average of five years. It has consistently reduced its distribution-payout ratio from 88% in 2014 to 72.5% in the first half of 2023 while increasing distribution at an average rate of 3%. It managed to do so by gradually acquiring stores from Canadian Tire and third-party owners. 

Enbridge uses the balance funds left after paying distribution to develop and intensify stores and earn higher rent. As Canadian Tire leases over 90% of CT REIT’s properties, the latter need not worry about occupancy. The major risk of this model is too much concentration on one tenant. Otherwise, the REIT is an all-weather stock you can buy whenever you have money. 

Like most TSX stocks, CT REIT stock is trading at its three-year low and is oversold. If you invest now, you can lock in a 7% yield. 

Enbridge stock

Enbridge (TSX:ENB) is a stock that needs no introduction. Its +60-year dividend history and vast pipeline infrastructure speak for itself. Over the years, most of the company’s pipeline projects have paid for themselves. It uses the toll money collected for transmitting oil and gas to pay its debt, build new pipelines, maintain old ones, and pay dividends. Even from the money it sets aside for dividends (distributable cash flow), it pays only 60-70% and keeps the remaining in reserve. 

Thanks to its low-risk model, Enbridge has sustained itself through the 2008 financial crisis, 2014 oil crisis, and pandemic while growing dividends. Even now, it can sustain this growth. In fact, the company is acquiring three gas utilities in this weak market, showing the resilience of its business. 

Enbridge stock is closer to its three-year low, creating an opportunity to lock in an 8.15% dividend yield. 

Even if the above stocks fall, regular investing can help you lock in higher yields and boost your passive income

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 Puja Tayal has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy.

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