Creating a $35,000 portfolio that can withstand market volatility requires a balanced approach grounded in diversification, risk management, and a long-term perspective. Rather than chasing the highest returns or trying to time the market, the key lies in building a resilient portfolio that can absorb shocks and still perform over time.
By spreading investments across fundamentally strong stocks and investing with a long-term mindset, one can generate more stable returns. Further, choosing high-quality TSX stocks with strong balance sheets, the ability to scale profitably, and a history of stable dividend payments can add resilience to your portfolio.
Against this backdrop, here are a few high-quality TSX stocks that can help create a portfolio that can withstand market volatility.
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Fortis stock
Investors planning to build a resilient portfolio could consider adding utility stocks. Companies operating in the utility sector have a defensive business model, benefiting from their regulated operations that help generate resilient earnings.
Within the utility sector, Fortis (TSX: FTS) can be a reliable bet. With 99% of its earnings derived from regulated utility operations, Fortis enjoys a relatively higher level of insulation from broader economic turbulence and market volatility. Its business centres on energy transmission and distribution, areas that are largely shielded from fluctuations in commodity prices and generally carry lower operational risk.
Thanks to resilient earnings and a growing rate base, the company has consistently rewarded investors with consistent dividend increases (for 51 consecutive years). Moreover, it offers a decent yield of 3.7% near the current market price.
Looking ahead, Fortis anticipates its rate base to increase at a compound annual growth rate (CAGR) of 6.5% through 2029. This expansion is expected to drive annual dividend increases of 4% to 6%. Backed by a diversified portfolio of regulated assets across North America, the company is well-positioned to continue delivering consistent earnings, which will support its stock price and dividend payouts.
Dollarama stock
Dollarama (TSX: DOL) is another resilient stock to consider for your portfolio, offering stability, growth, and income. Known for its broad selection of consumable goods, seasonal items, and general merchandise, often priced at $5 or less, Dollarama’s value-driven model continues to attract steady customer traffic.
Further, its stores are strategically located in high-traffic areas across cities and towns, and it’s expanding convenience by partnering with third-party delivery services to offer same-day home delivery across Canada.
Thanks to its value proposition and focus on adding convenience, Dollarama has consistently delivered solid growth. Notably, Dollarama has consistently outperformed the broader markets with its returns. Its stock has gained over 26% year to date, while it has soared 274.9% over the past five years. Dollarama has also been a reliable income generator, raising its dividend 14 times since 2011.
Looking ahead, Dollarama’s strategy is focused on growing its store footprint while maintaining its appeal through low prices and essential merchandise. This, combined with operational efficiencies, positions the company well for continued earnings growth that will support its share price and dividends.
The bottom line
Fortis and Dollarama have consistently performed well, offering resilience in the face of economic volatility. Their ability to withstand market volatility makes them attractive choices for investors seeking dependable returns.
Adding to this defensive strategy, Loblaw (TSX: L) offers another layer of protection. As a leading grocery and pharmacy chain, Loblaw operates a business model that performs well regardless of the economic climate. Its steady performance across market cycles makes it a reliable option for investors looking to balance risk while maintaining exposure to growth.
Beyond these TSX stocks, blue-chip giants like Canadian National Railway, Royal Bank of Canada, and Enbridge further enhance a portfolio’s resilience. These companies have a long track record of generating stable earnings regardless of market conditions and rewarding shareholders through consistent dividend increases. Their combination of income and stability makes them particularly appealing to those looking to weather economic uncertainty without sacrificing returns.
