After a disastrous start to the month, the Canadian stock market managed to stop the bleeding last week, at least temporarily. The S&P/TSX Composite Index finished last week up a surprising 2%. Still, the index is down 5% since the beginning of April.
In the short term, it’s anybody’s guess as to how the market is going to react to the ever-changing global macro-environment climate. What we can draw on in times like these, though, is a rich history of returns from the stock market. There’s always going to be volatility along the way, but over time, I’d feel good about betting on the stock market at some point, getting back on track.
Taking advantage of the market’s volatility
I’d encourage long-term investors to make sure their watch list is up to date right now. There are already plenty of top-quality TSX stocks trading at bargain prices today.
Of course, we could see more pain in the short term, but that is no reason to try and time the market. If you have an opportunity to load up on a quality company that’s trading at a bargain price, I’d be ready to jump on that sometime soon.
With that in mind, I’ve put together a well-rounded basket of three Canadian stocks that are all currently trading below $100.
Stock #1: Brookfield
Brookfield (TSX:BN) is a perfect pick for an investor who’s looking to put some money into the market but is unsure of which stocks to invest in.
The $100 billion company is a global asset manager with exposure to a range of different industries. Brookfield is as close as you’ll come to matching the diversification that a broad-market index fund can offer.
But as diversified as the stock is, it hasn’t had any trouble outperforming the market’s returns. Shares are up 75% over the past five years, easily outpacing the returns of the Canadian stock market as a whole.
Stock #2: Bank of Nova Scotia
During volatile market periods like these, owning a reliable dividend-paying company like Bank of Nova Scotia (TSX:BNS) can go a long way.
In addition to the dependability and defensiveness that a Canadian bank typically provides, there’s also plenty of passive income to enjoy.
At today’s stock price, Bank of Nova Scotia’s dividend is yielding a whopping 6.5%, ranking it as the highest yielding amongst the Big Five.
Stock #3: Northland Power
Last on my list is a beaten-down renewable energy stock. The sector as a whole has not been kind to investors in recent years. Leaders across the space have been on the decline since early 2021.
Excluding dividends, shares of Northland Power (TSX:NPI) are down more than 50% since the start of 2021. The only bright spot for shareholders as of late has been the company’s dividend, which is currently yielding above 6%.
I wouldn’t bank on a quick turnaround for Northland Power, or the entire renewable energy sector, for that matter. That being said, if you’re a renewable energy bull and have time on your side, now could be an incredibly opportunistic time to load up on a discounted stock like Northland Power.
