SPY Stock Is Just the Tip of the Iceberg for Canadians Investing in the U.S.

It’s often said that diversifying your portfolio is a great thing to do. This is because diversification into different spaces can help spread your risk. Over the long run, this could provide your portfolio with some stability, reducing volatile swings should a certain sector be impacted. However, one form of diversification that investors sometimes forget about is geographic diversification.

As the term suggests, this form of diversification refers to the diversification of assets across different regions of the world. For Canadians, the U.S. is a very common place to diversify into. This is because Canadians are, for the most part, very familiar with many of the large companies that operate in the States.

Newer investors are often told to consider investing in SPDR S&P 500 ETF Trust (NYSEMKT: SPY). This is an exchange-traded fund (ETF) that tracks the performance of 500 large American companies. I’m a big believer that the S&P 500 could generate solid gains over the long run. However, if you hope to create generational wealth, then individual stocks would be the best way to go. With the S&P 500 just being the tip of the iceberg, here are two great U.S. stocks to invest in.

My favourite U.S.-listed stock

I specifically called this first company a U.S.-listed stock because although it trades on the NYSE, Sea Limited (NYSE: SE) is actually a Singapore-based company. For those unfamiliar, Sea Limited mainly operates within southeast Asia, although the company has spread to different continents at this point. Sea Limited’s business operates three different “arms.” This includes Garena, Shopee, and SeaMoney. Those represent Sea Limited’s gaming, e-commerce, and digital banking divisions, respectively.

Of those three divisions, Shopee stands out as Sea Limited’s major moneymaker. In the second quarter (Q2) of 2023, Shopee reported US$2.1 billion in revenue. To put that into perspective, Sea Limited’s total revenue for that quarter was US$3.1 billion. In terms of what investors should keep an eye on, that would be SeaMoney. This is Sea Limited’s fastest-growing division and could be a major catalyst for the stock over the coming decade.

A great American company

Procter & Gamble (NYSE: PG) was the very first stock that I ever bought. What attracted me to this company was its large portfolio of products that are relied upon by millions of consumers across the globe. If you’re unfamiliar, you should know that this is the company behind popular names such as Tide, Charmin, Gillette, Crest, and many more.

Procter & Gamble is very well-known among investors for being a solid dividend payer. In fact, its 67-year streak of increasing its dividend distributions is one of the most impressive business feats in America. As it stands, only three companies have managed to maintain a longer dividend-growth streak. Over the past five years, Procter & Gamble stock has gained about 68%, dividends excluded. That’s a very great return for a company that doesn’t require investors to take on a lot of risk.