The Best Long-Hold Canadian Stocks to Marry in a TFSA

These may be popular choices, but there’s a reason for that. In the long term, these three stocks are solid winners.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published October 7, 2024 4:20 pm EDT

Long-hold Canadian stocks can be the best way to invest. These allow you to ride out market ups and downs while growing your wealth over time. With strong, dividend-paying companies like the ones on the TSX, you not only benefit from price appreciation. You also get it from consistent cash flow that can be reinvested or enjoyed. Plus, holding onto stocks long term can save you on taxes and the stress of constantly trying to time the market. Just let compounding do the heavy lifting while you focus on enjoying life!

Canada national flag waving in wind on clear day — Source: Getty Images

Royal bank

Royal Bank of Canada (TSX:RY) is a perfect long-term hold for many reasons, but its consistent performance and strong dividends stand out. Over the past decade, RBC has delivered a compound annual growth rate (CAGR) of around 10%. Thus making it a reliable option for investors looking for both capital appreciation and income. The bank’s dividend history is solid, with a current yield of around 3.4%, and its payout has grown steadily over the years. In fact, RBC has increased its dividend nearly every year for over a decade, showing its commitment to returning value to shareholders. With its diversified business model across banking, wealth management, and capital markets, RBC is well-positioned to weather market fluctuations and continue growing.

Looking ahead, RBC’s future outlook remains bright, especially with strong fundamentals like a profit margin of 28.67% and return on equity of 13.68%. The bank’s ability to consistently generate revenue and navigate various economic conditions makes it a cornerstone for any Canadian portfolio. With its forward price-to-earnings (P/E) ratio sitting at 12.87, RBC still has room to grow while maintaining its stability.

BAM stock

Brookfield Asset Management (TSX:BAM) is a fantastic long-term hold for investors seeking steady growth and income. Over the past decade, BAM has demonstrated solid performance with its impressive expansion into diverse areas like real estate, infrastructure, and renewable energy. With a strong focus on managing and acquiring high-quality assets, BAM has delivered a compound annual growth rate (CAGR) of around 12%, thereby making it an attractive choice for those looking for both capital appreciation and stable returns. While the dividend yield of 3.18% may not seem high at first glance, it’s been steadily growing, offering investors consistent income over the years.

Looking ahead, BAM is well-positioned for future growth, particularly with the increasing demand for infrastructure and renewable energy investments. Its strong return on equity of 16.13% shows that management knows how to put shareholder capital to good use, ensuring long-term value creation. With a solid balance sheet, strategic global investments, and a focus on high-growth sectors, BAM offers a rare combination of growth potential and income stability — perfect for those wanting a reliable stock to hold in a Tax-Free Savings Account (TFSA) for decades.

XIU ETF

iShares S&P/TSX 60 Index ETF (TSX:XIU) is a fantastic long-term hold for investors seeking a solid, low-maintenance portfolio. This exchange-traded fund (ETF) gives you exposure to the 60 largest and most stable companies in Canada. With a healthy yield of 2.92% and a very reasonable expense ratio, XIU offers consistent income without eating into your returns. Historically, XIU has delivered strong long-term performance, boasting a year-to-date return of over 16%. Including an impressive track record dating back to its inception in 1999. Over the years, the fund has maintained a steady CAGR, which provides growth and dividend income, thus making it a great choice for investors looking for stability and gradual wealth accumulation.

Looking ahead, XIU’s diversified portfolio across sectors like financials, energy, and technology ensures that it’s well-positioned to continue delivering strong returns, even in volatile markets. With a P/E ratio of 14.72, the ETF remains reasonably valued. Thus giving investors confidence in its ability to grow over time. Whether you’re just starting out or looking to hold for decades, XIU’s combination of steady dividends, long-term growth, and broad sector coverage makes it a reliable choice for a TFSA, providing both peace of mind and financial growth for the future.