There will never be a picture-perfect time for new investors to get started investing. Undoubtedly, when volatility hits, and there are a plethora of unknowns (geopolitical, economic, elections, and more), it can certainly feel tempting to put off investing your first $2,000 or so. Indeed, why rush into the stock market when there’s a chance that it could be markedly lower in a week, a month, or even a quarter from now?
Though Canada isn’t in a recession, many Canadians feel like we’ve been in one for quite a while now. Pin it on high inflation or the cool jobs market, if you will. Still, we’ve heard chatter about a “per-capita recession,” which, while not an official economic recession, may share many of the symptoms that come with the formal definition of a recession (that’s two straight quarters of negative GDP growth).
New investors: Don’t wait too long to get started!
Indeed, Canada’s population may have stopped Canada from sinking into a traditional recession. However, with everyday Canadians feeling the pinch, it may seem like a pretty bad time to put new money to work, especially with some fearing a potentially rough landing for the economy as the Bank of Canada looks to cut rates perhaps faster than it raised them.
In any case, the TSX Index is off just one percent from all-time highs. And with so much fear about a potential recession on the way or the concept of a per-capita recession, perhaps it’s best to raise a bit of dry powder to prepare for a rainier day, right?
Though times have been tougher, and some may be inclined to put their wallets away, it’s the stock market that tends to predict a recession rather than the other way around. Indeed, it would have been more useful for investors had the recession been a predictor of market plunges.
Either way, the TSX Index is starting to gain steam as the Bank of Canada looks to cut rates, perhaps more aggressively than anticipated initially. Lower rates are a good thing for consumers and businesses. Less money spent on interest on debts means more cash to splurge on various consumer goods. And with the AI boom continuing to unfold, things could be a lot better than expected. Sometimes, the bar is low enough that it does not take a whole lot to impress!
Brookfield Corp.: Strong alternative assets; excellent managers
If you’re a new investor looking to put new money to work, I’d argue it makes sense to consider battered bargains that can fare well in good times and bad. Consider Brookfield Corp. (TSX:BN), a legendary alternative asset manager that’s just shy of all-time highs.
The firm may have the wind at its back (shares up 49% in the past year), but the stock still looks incredibly cheap for what you get. From well-run renewable energy projects to vital, recession-resilient infrastructure assets to lowly correlated private equity, you’re getting a lot of magnificence from one security.
The company recently partnered with Microsoft (NASDAQ:MSFT) to work on a clean energy project. As Microsoft sets a high bar for the rest of the industry, I think many other firms could step up and place big bets on their own renewable commitments.
