It’s been a good year for Canadian investors so far. The S&P/TSX Composite Index is up close to 10% in 2024. And that’s not even including dividends, either. The market as a whole did see a pullback last week, though, spooking some short-term investors.
There’s been no shortage of volatility over the past few years. But as long as you’re patient and plan on holding your investments for years to come, you shouldn’t be overly concerned with the market’s behaviour last week. Volatility is one non-negotiable price that you’ll need to pay if you’re looking to earn long-term returns in the stock market.
If you’re concerned about volatility in the near term, I’d consider loading up on reliable companies you can count on. Fortunately, the TSX is loaded with top-quality companies like that to choose from.
Here are three companies that you don’t need to think twice about buying today.
Constellation Software
At a stock price above $4,000, Constellation Software (TSX:CSU) isn’t exactly the cheapest stock around. You’ll need to pay up to own shares of this high-growth tech company. However, based on the stock’s performance in recent years, it’s been worth every penny.
Over the past five years, shares of Constellation Software have returned more than 200%. In comparison, the Canadian stock market has returned less than 50%, excluding dividends.
As a growth stock, Constellation Software will be more sensitive to volatile market periods. The company has proven, though, that it’s been able to manage all kinds of volatility over the years, continuing to consistently outperform the market’s returns.
If you’re willing to pay up to be a Constellation Software shareholder, your future self will be thanking you in no time.
Toronto-Dominion Bank
Investors who are looking to limit volatility in their portfolios should consider a Canadian bank as their next purchase. Any one of the Big Five can add both defensiveness and a top dividend to an investment portfolio.
At a market cap of $140 billion, Toronto-Dominion Bank (TSX:TD) is one of the largest stocks on the TSX and the second-largest amongst the major Canadian banks.
With an established and growing presence in the U.S., TD Bank shareholders will gain exposure to more than just the Canadian economy. With diversification being as important as it is in a portfolio, having that U.S. exposure can go a long way for Canadian investors
At today’s stock price, the bank’s dividend is yielding just about 5%.
Brookfield
There’s never a bad time to be loading up on shares of this well-diversified company.
Brookfield (TSX:BN) is a global asset manager with investments spanning a range of different industries.
When it comes to diversification, Brookfield is as close as you’ll get to matching a broad market index fund like the S&P/TSX Composite index. But as diversified as the stock is, it hasn’t had any trouble outperforming the broader market’s returns in recent years.
Shares of Brookfield are up a market-beating 60% over the past five years.
If you feel your portfolio lacks diversification, this TSX stock should be at the top of your watch list right now.
