Investing is essential for all Canadians to help grow their savings and put their hard-earned capital back to work for themselves. However, as crucial as investing is and as much potential as it can offer, it’s not always smooth sailing. This is why it’s so important to buy safe Canadian stocks alongside your high-potential growth stocks to help protect your capital during market volatility.
Having a diversified portfolio of high-quality stocks is essential to help you take advantage of any market environment. So that means owning high-potential growth stocks that can benefit from market rallies, as well as reliable and safe stocks that can thrive in times of economic turmoil.
Furthermore, since changes in the market environment aren’t typically easy to predict, it’s essential to ensure your portfolio is always well-diversified and you’re ready for whatever comes your way.
So, with that in mind, if you’re looking for safe Canadian stocks to buy today, here are some of the best to buy and hold for the long haul.
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Utility stocks are some of the safest Canadian businesses you can buy
If you’re looking for safe stocks to buy and hold through market volatility, the utility sector is likely where you’ll want to start.
Utilities are some of the lowest-risk businesses you can invest in for several reasons. First off, they provide services that are essential and which have sticky demand. So even if the economy is struggling and we’re on the verge of a recession, most households and businesses will still need their electricity, heat, and water.
Furthermore, the industry is regulated by the government, so these companies often know well in advance how much profit they should make each quarter based on their sales, which also don’t fluctuate much.
This is part of why utility stocks are so reliable. Not only can they consistently earn a profit, whether the economy is struggling or not, but because the growth is highly predictable, utility stocks are some of the least volatile stocks on the market. Furthermore, it also makes their dividend growth a lot more predictable as well.
There are several high-quality utility stocks to consider in Canada, such as Emera, Hydro One, and even Fortis, which has a dividend growth streak of more than half a century.
So, if you’re looking for safe Canadian stocks to buy now and hold through higher market volatility, a top-notch utility stock is one of the best choices you can make.
A top growth stock with defensive qualities
Utility stocks are excellent businesses for adding reliability to your portfolio and helping to protect your capital. Furthermore, they’re consistently growing their earnings and dividends, making them stocks you can own for the long haul.
However, the one drawback of utility stocks and many of the most defensive stocks on the market is that although they’re safe investments, they also don’t grow as fast as other less reliable companies.
So, in many cases, you sacrifice growth potential for reliability. However, that doesn’t always have to be the case. For example, a stock like Brookfield Infrastructure Partners (TSX:BIP.UN) offers the best of both worlds.
As its name suggests, Brookfield owns a portfolio of high-quality and essential infrastructure assets. These include businesses such as ports, railroads, telecom towers, and midstream energy assets in addition to utilities as well.
Furthermore, the portfolio of assets isn’t just diversified by industry. It’s also diversified geographically, with investments all over the world.
This geographic diversification is essential both for mitigating risk and exposing Brookfield to different regions around the world where it can take advantage of new opportunities and changing economic environments.
Furthermore, because its infrastructure assets provide essential services and most of its revenue is indexed to inflation, Brookfield is one of the most reliable Canadian stocks to buy now and hold through market volatility.
Plus, because it’s consistently looking for new investment opportunities, it can grow faster than a typical defensive stock. Not to mention, it also pays an attractive dividend that has a current yield of 4.5%, which it aims to grow by 5% to 9% each year.
Therefore, if you’re looking to shore up your portfolio today and buy safe Canadian stocks you can hold for years, Brookfield infrastructure is undoubtedly one of the top choices.
