The market is full of great long-term investments that can cater to both growth and income-seeking investors alike. Among those great picks are a subset of stocks that are truly stellar picks for long-term investors right now. Best of all, those stocks can appeal to those who are ready to invest $5,500.
Here’s a look at two great picks for those investors who can invest $5,500 today.
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Have you considered this big bank stock?
Canada’s big bank stocks are among the best long-term holdings for any portfolio. While there are a multitude of reasons for this, it comes down to three key points. Specifically, the banks offer reliable domestic revenue generation, growth from international markets and a juicy, growing dividend.
Among those big banks, Toronto-Dominion Bank (TSX: TD) remains one of the best options for investors to consider right now.
TD is the second-largest of the big banks, and apart from boasting a massive domestic segment, it also boasts a huge presence in the U.S. In that U.S. market, TD’s branch network stretches from Maine to Florida along the east coast.
Not only does that segment include millions of customers and billions of deposits, but it also fuels TD’s long-term growth strategy. That being said, TD’s domestic segment still generates the bulk of its revenue.
In that first quarter, the domestic segment reported record revenue of $1,831 million, reflecting a solid 3% increase over the prior period.
Turning to income, TD offers a tasty quarterly dividend. As of the time of writing, the yield on that dividend works out to 4.7%. This means that those who can invest $5,500 can expect to generate a first-year income of just over $250.
For long-term investors, that initial investment is enough to generate a few shares through reinvestments. Prospective investors can also expect that number to grow thanks to TD’s established cadence of providing annual increases to that dividend.
Generate a recurring income, just like a landlord
One of the tried-and-true ways to establish an income stream is owning a rental property. Unfortunately, rising interest rates and a housing shortage have priced most would-be landlords well out of the market.
The alternative for those investors comes in the form of RioCan Real Estate (TSX: REI.UN).
RioCan is one of the largest REITs in Canada, boasting a portfolio of nearly 200 sites, primarily in metro markets across the country.
Historically, RioCan’s portfolio was focused on commercial retail properties, but in recent years, that mix has shifted to include mixed-use residential properties.
Those properties, which RioCan refers to as RioCan Living, comprise residential towers sitting atop several floors of retail. The properties are located in high-traffic, high-demand areas in metro areas, furthering the appeal.
The result is that investors have a way to generate a reliable and recurring revenue stream, even for those who can only invest $5,500. As of the time of writing, RioCan’s monthly distribution boasts a juicy yield of 6.7%
For that initial investment, RioCan investors can expect to generate a monthly income that can provide additional shares each month through reinvestments.
Will you invest $5,500 today?
Both RioCan and TD Bank are superb stocks that are attractive options for both income and growth-seeking investors. They both offer defensive appeal that should, in my opinion, be core parts of any well-diversified portfolio.
Buy them, hold them, and watch your future income grow.
