When it comes to building a portfolio focused on passive income, a high-dividend strategy can be both rewarding and comforting. Having reliable monthly or quarterly cash rolling into your account helps take the stress off market swings. With $10,000 to invest, there are two standout TSX stocks that catch my eye. Those are SmartCentres Real Estate Investment Trust (TSX:SRU.UN) and Fiera Capital (TSX:FSZ). Both offer attractive dividend yields and a strong foundation to help anyone serious about generating income — all while adding a nice bit of stability to a portfolio that might otherwise feel a little too tied to market ups and downs.
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SmartCentres
Let’s start with SmartCentres Real Estate Investment Trust (REIT). SmartCentres has been a fixture in the Canadian real estate scene for years. While it is best known for its shopping centres, SmartCentres has been busy transforming itself into something even more resilient. Today, it holds a wide mix of retail, residential, and self-storage developments, which really spreads out its risk. It is no longer just about traditional malls. As of writing, SmartCentres offers a dividend yield of around 7.35%, paid out monthly. That monthly paycheque is a big bonus for retirees or anyone who prefers to see regular income without waiting for a quarterly deposit.
Looking deeper into its financials, SmartCentres reported strong numbers in its latest results. It finished 2024 with an occupancy rate of over 98%, which is outstanding in real estate. Furthermore, its net rental income remained steady despite higher borrowing costs. Even better, many of SmartCentres’s tenants are essential businesses, like grocery stores and pharmacies, that tend to thrive no matter what the economy is doing. That gives it an edge during slower periods. Plus, the dividend stock continues to invest heavily in mixed-use projects that combine retail, residential, and office spaces. This sets itself up for future growth without having to depend entirely on retail stores.
Fiera Capital
On the other side of this income portfolio is Fiera Capital. Fiera might not be a household name to every Canadian, but among investors, it’s a serious player. Fiera is an independent asset manager that looks after about $158 billion in assets globally. What makes it so attractive for an income portfolio is its dividend yield, which is currently sitting at a whopping 13.82%. Yes, you read that right.
Fiera pays a quarterly dividend, and while that huge yield is enticing, it does come with some caution. The dividend stock’s payout ratio is high, currently at 375%, meaning all its earnings are being passed back to shareholders. That is fantastic for income today, but it does mean Fiera has less flexibility if markets get rough. That being said, Fiera’s leadership has been smart about expanding through strategic acquisitions and diversifying its client base. This should help it keep cash flow stable. In its latest earnings, Fiera reported steady fee-based revenue, and management reaffirmed its focus on maintaining a healthy balance sheet.
Foolish takeaway
Of course, dividends are never guaranteed. SmartCentres is fairly defensive, but if consumer habits shift dramatically or we face another real estate crisis, it could feel pressure. Fiera, meanwhile, is more exposed to market volatility since its revenues are tied to assets under management. But by pairing the dividend stocks together, investors get a blend of stability and yield, which is exactly what you want when building an income-focused portfolio.
For investors who value cash flow and want to build a dependable portfolio without overcomplicating things, SmartCentres and Fiera are two names worth considering right now. As always, it is wise to keep an eye on earnings and market trends, but with starting dividend yields like these, the heavy lifting is already baked into the portfolio. And that, for any income investor, is a pretty sweet deal.
