Trump tariffs have made even veteran investors panic. Market experts have increased the probability of a recession. Starting the investment journey in a turbulent stock market can make beginner investors apprehensive.
Especially with all the big talks around inflation, economic growth slowdown, and economic jargon, you may feel like delaying investing.
Do not make that mistake.
The market correction is a perfect time to invest in evergreen stocks.
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My top five Canadian stocks for beginner investors
The Tax-Free Savings Account (TFSA) has a $7,000 contribution room for 2025, and now is the best time to use the room.
Growth stocks
Descartes Systems (TSX:DSG) is a resilient growth stock that can give you a 20% compounded annual return in five years. What makes it resilient is the robust implementation of its go-to-market strategy. Descartes’s supply chain solutions offer companies services ranging from routing and mapping to custom compliance to global trade intelligence to inventory management. It even updates its offerings as per the market needs.
For instance, it expanded its e-commerce solutions during the pandemic and compliance offerings during the 2018 U.S.-China trade war. Knowing which service to offer when and making that service relevant to the evolving needs has helped Descartes grow its revenue and earnings consistently. It is a stock to buy the dip and hold for at least five years to double your money.
E-commerce company Shopify (TSX:SHOP) is a seasonal stock. You can consider investing in it when the stock price falls closer to $100-$110 in the second quarter and sell after the holiday season ends in January. The e-commerce giant earns revenue as a percentage of gross merchandise volume (GMV). It grows its percentage by offering vendors multiple services, from marketing to online payments to loans.
However, the e-commerce business depends on volumes, which makes it seasonal. Now is a good time to buy the stock as it has dipped 36% from its seasonal high of $183 and is trading near $117.
Dividend stocks for beginner investors
One of the most resilient dividend stocks that has funded the retirement of thousands of Canadians is Enbridge (TSX:ENB). It has more than 60-year history of paying dividends. Recently, it came into the limelight as Trump imposed a 10% tariff on Canadian oil imports. The oil price fell from above US$70 to around US$60 per barrel as it adjusted for the 10% tariff.
The decline in oil prices is bad news for oil-producing companies, but Enbridge is an oil pipeline company that helps export Canadian oil to America through its pipelines. Its dividends will remain unaffected in the short term. Like Shopify, Enbridge stock is also seasonal. In summer, oil and gas usage for heating reduces, and its stock price falls closer to the $50 price point. You could consider buying it then and locking in a 7% yield.
CT REIT (TSX:CRT.UN) is another dividend stock you could consider buying, as the stock has slipped 3.7% in the market correction. The REIT earns 90% of its rental income from its parent company, Canadian Tire.
This could be a good time for Canadian Tire as people may stall their new car purchase and buy auto parts to improve the performance of their existing cars.
Even if consumer spending slows and Canadian Tire decides to reduce its store count, CT REIT can continue paying dividends, as it pays only 75% of its distributable cash flow as dividends. This gives it flexibility to withstand temporary headwinds.
The technology ETF
iShares S&P/TSX Capped Information Technology Index ETF (TSX:XIT) is a portfolio of 20 Canadian technology stocks. The exchange-traded fund (ETF) gives you exposure to the price volatility of this portfolio. Tech stocks fell as the market fell, and the XIT ETF’s unit price fell 24%. Now is a good time to buy this ETF, as its unit price will rise when the market recovers. You can get exposure to the growth trend of artificial intelligence, 5G, and e-commerce with just one ETF.
Investor takeaway
The best way to begin is to invest in companies whose products and services you will continue to use for years.
