1 TFSA Stock That's a Screaming Buy for March

1 TFSA Stock That’s a Screaming Buy for March

Vanguard Emerging Markets ETF (TSX:VEE) is a screaming buy in March.

Andrew Button

Author Bio

Andrew “A.J.” Button is a financial writer with a longstanding interest in value investing and international markets. He began investing at a young age, building a portfolio of dividend stocks to help pay for university. After stepping away from investing for a time, he rediscovered his passion in 2019 when he began working as a freelance financial writer. Since then, Andrew has built a diversified investment approach spanning Canadian, U.S., and international equities, as well as guaranteed investment certificates (GICs) and money market funds. He is particularly interested in international stocks, drawn to their dividend potential and long-term growth opportunities, while maintaining an interest in Canadian businesses. Before joining The Motley Fool, Andrew worked as a freelance copywriter specializing in financial services. He continues to write for financial publications and share his thoughts on stocks through social media.

Education and Professional Credentials

Canadian Securities Course (CSC)
CFA Program Level I examination completed

Areas of Expertise

Value investing, Canadian equities, U.S. stocks, international equities, dividend investing, long-term investing, GICs, money market funds, and portfolio diversification.

Social Media Profiles

Published February 27, 2025 4:20 pm EST

Are you looking for Tax-Free Savings Account (TFSA) stocks that are “screaming buys” for March?

In one sense, it’s not the most sensible question to ask because the melodramatic “screaming” language employed in the question risks influencing the asker to make rash decisions.

However, there is one class of “stocks” that really is worth screaming about: index exchange-traded funds (ETFs).

Index funds are diversified portfolios of stocks based on major equity indexes. “Exchange-traded funds” are funds that trade on the stock market. Index ETFs are index funds in ETF form. Studies show that these funds outperform 95% of professional investors over a 20-year time frame and are at low risk, too.

While an ETF is technically a little different from a stock, it is nevertheless a stock investment because it trades on the stock market and has stocks under the hood. With that in mind, here’s one TFSA stock investment that is a screaming buy in March.

space ship model takes off — Source: Getty Images

Vanguard Emerging Markets ETF

Vanguard Emerging Markets ETF (TSX: VEE) is an index fund that invests in some of the cheapest and fastest-growing companies in the world. Emerging market countries are nations like China, India and Brazil, which typically grow faster than Western countries. Due to the cheapness of these countries, VEE’s portfolio trades at low multiples:

14 times earnings
Two times book

That’s despite its underlying companies growing earnings at 15%!

The same metrics for the S&P 500 are as follows:

33 times earnings
Five times book
18.7% earnings growth

Technically, the S&P 500 earnings growth rate is still a bit higher than that of VEE’s portfolio. However, the PEG (price-to-earnings-to-growth) ratio for VEE (0.93) is far lower than the S&P 500’s (1.76). So, you pay less for the growth you get with VEE.

Fund characteristics

VEE has many characteristics that make it desirable to investors:

High diversification (5,884 stocks)
A relatively low fee (0.23%)
A decent amount of trading volume
A comparatively cheap valuation

These basic characteristics should help VEE deliver adequate investment performance over the long term. However, where VEE really shines is in its potential as a tactical bet in 2025. With the valuation discrepancy between the S&P 500 and VEE, the level of outperformance this fund could deliver is substantial. This isn’t guaranteed, of course, but with the U.S. markets trading near an all-time high P/E ratio and an even higher Shiller PE ratio (price to five-year normalized earnings), global stocks could really shine. VEE is your best way to get diversified global stock exposure on the TSX.

The bottom line

Is any stock ever a screaming buy? It depends on how informed you are about it and the price you have to pay for it. While I know few individual stocks today with truly off-the-charts performance prospects and cheap valuations, I know that index funds deliver “scream”-worthy outperformance over time. You’d probably do fine in the long term holding a TSX index fund and just sitting on it. However, with North American equities trading at a record-high premium to global equities, VEE is the more exciting opportunity.