The Canadian financial sector is often synonymous with the Big Five banks — but that’s far from the whole story. If you’re sitting on $3,000 and want to invest on top of these names with long-term upside potential, here are three TSX stocks that offer diversified exposure, growth, and income potential, making them excellent “buy-and-hold-forever” candidates.
Brookfield Asset Management: A cash machine with long-term growth
Brookfield Asset Management (TSX:BAM) is one of the largest alternative asset managers globally, with over US$1 trillion in assets under management (AUM) and a growing base of long-term institutional clients. Its AUM include infrastructure, real estate, renewable energy, private equity, and credit.
Its business model is fee-based and capital-light: BAM earns management and performance fees from the assets it oversees, with recurring revenue streams that are highly scalable and durable.
What makes BAM an obvious long-term hold?
- Secular tailwinds: Demand for infrastructure, clean energy, and private credit is increasing globally.
- Inflation protection: Real assets like utilities and real estate often adjust with inflation, adding a hedge.
- Dividend growth: With a decent dividend yield of 3.2% and a high dividend growth potential, the stock appeals to income and growth investors alike.
Backed by Brookfield Corporation (TSX:BN), BAM is built for longevity and scale. It’s a compelling compounder for those with a long-term investment horizon.
Intact Financial: Canada’s top P&C insurer
Intact Financial (TSX:IFC) is the dominant player in Canada’s property and casualty (P&C) insurance market. The company also operates in the U.S. and Europe, offering home, auto, and commercial insurance solutions.
Why does Intact Financial deserve a place in a long-term portfolio?
- Defensive sector: Insurance is a necessity, not a luxury. Demand remains stable even during recessions.
- Underwriting discipline: IFC has consistently delivered underwriting profitability, even in volatile markets.
- Growth through acquisition: The company has a proven mergers and acquisitions track record, including its 2021 purchase of U.K.-based RSA Insurance.
Intact Financial is also a strong dividend grower, boasting about 20 consecutive years of dividend increases, with a five-year compound annual growth rate of nearly 10%. With a current yield of about 1.7%, at around $305 per share the fairly valued stock offers a bit of income on top of compounding growth. As the population grows and insurance needs become more complex, Intact Financial is well-positioned to benefit.
goeasy: Underrated, high-growth lender with a nice yield
goeasy (TSX:GSY) is a riskier name, but long-term investors know its potential. The company provides non-prime consumers with personal loans, home equity products, and lease-to-own financing through its easyfinancial and easyhome divisions.
What makes goeasy unique is it offers a nice mix of growth, profitability, and yield:
- Revenue and diluted earnings per share (EPS) grew at about 17% and 27%, respectively, per year in the past decade.
- It maintains high returns on equity (ROE) and strong credit performance despite serving higher-risk borrowers (In the first quarter, the adjusted ROE was 20.4% and the net charge off rate was 8.9%, within its 8.75–9.75% forecast.)
- The stock pays a growing dividend (currently yielding around 3.6%), with annual dividend hikes for about a decade. Its more recent (three-year) dividend growth rate was 21%.
While it operates in a riskier segment, goeasy’s underwriting technology and conservative provisioning have helped it navigate economic cycles remarkably well. For investors with a higher risk tolerance, goeasy can be a growth engine with strong income to match.
The investor takeaway
You don’t need to limit yourself to banks when investing in Canadian financials. With Brookfield Asset Management, Intact Financial, and goeasy, you get a diversified trio spanning global real asset management, core insurance, and high-growth lending. Together, they offer a powerful blend of income, resilience, and long-term upside — perfect for a $3,000 investment you can set and forget.
