When markets start to get volatile, headlines turn negative, and it feels like every Canadian stock is selling off, it’s natural for investors to feel uneasy.
Whether it’s concerns about interest rates, a slowing economy, or geopolitical tensions, there’s always something that can create uncertainty in the short term.
However, the problem isn’t that volatility shows up from time to time; it’s how investors react when it does.
That’s when people start thinking about reducing risk, holding more cash, or even selling positions altogether. And more often than not, it’s those reactionary decisions that lead to mistakes.
That’s why, instead of trying to predict what the market will do next or constantly adjusting your portfolio, you’re far better off making sure the portfolio you build in the first place is reliable.
Because when you own high-quality businesses that can continue to perform, generate cash flow, and reward shareholders regardless of what’s happening in the broader market, volatility becomes a lot easier to deal with.
And that’s exactly why certain Canadian stocks stand out as some of the best to own when market anxiety starts to rise.
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The types of Canadian stocks that actually hold up
Although it may not always seem like it, when uncertainty increases, not every stock reacts the same way.
Some businesses are heavily dependent on economic growth, strong consumer spending, or favourable market conditions, such as tech or e-commerce stocks. So, when the economy starts to weaken, those stocks can quickly come under pressure.
However, other businesses are built very differently. They provide essential services, operate with predictable cash flow, and in many cases, have long-term contracts or regulated assets supporting their operations.
That’s why Canadian stocks like Fortis (TSX:FTS) and Enbridge (TSX:ENB) are two of the best examples of companies that can hold up well in almost any environment.
Fortis is a regulated utility, which means the vast majority of its revenue is essentially set in advance. People still need electricity and gas regardless of what the economy is doing, and that’s what makes its cash flow so reliable.
That consistency is also why Fortis has been able to increase its dividend for more than 50 consecutive years.
Similarly, Enbridge operates one of the largest energy infrastructure networks in North America, earning steady fees for transporting energy, often through long-term contracts.
That’s exactly the type of reliability investors want when markets become unpredictable, and it’s also why both of these stocks continue to be some of the most popular core holdings for long-term income investors in Canada.
Balancing stability with long-term growth
At the same time, as important as reliability is, building a sustainable income stream you can count on is not just about owning the most defensive stocks possible.
Because while stability matters, you still want to own businesses that can continue to grow and create value over time, such as Canadian National Railway (TSX:CNR) and Alimentation Couche-Tard (TSX:ATD).
Canadian National Railway is one of the best long-term investments you can make because it connects key regions across the continent, and there are massive barriers to entry that make it almost impossible to replicate.
That gives it significant pricing power and the ability to generate consistent earnings over the long haul. So even when economic conditions weaken, it remains a critical part of the supply chain.
Couche-Tard, on the other hand, operates a global network of convenience stores and fuel stations. And while that might not sound exciting, it’s exactly what makes the business so resilient.
People still buy fuel, coffee, and everyday items regardless of the economic environment. Plus, on top of that, the company has a long track record of using its strong cash flow to acquire other businesses and continue expanding globally.
So, while both of these stocks offer stability, they also provide long-term growth potential, which is just as important for investors who are building wealth over time.
The Foolish takeaway
Managing your portfolio through periods of volatility isn’t about trying to turn to cash and avoid it. It’s about owning businesses that you can continue to hold with confidence when that volatility does inevitably materialize.
That’s why these four Canadian stocks are some of the best to buy today.
Plus, once you’ve built a reliable foundation, it becomes much easier to stay invested and look for new stocks that can outperform over time.
That’s ultimately how long-term investors win, not by reacting to every headline, but by owning businesses they never feel the need to sell in the first place.
