Finding that perfect mix of investments in a passive income portfolio often involves picking the highest yield. And while there are more than a few great TSX stocks to own, picking those income producers off yield alone isn’t the answer.
If that stock with a huge yield runs into trouble, investors can be caught bag-holding. The market saw a prime example of that over the past few years as Canada’s big telecoms were forced to slash their payouts.
A better approach for investors is to spread those investments across several businesses that can offer those attractive yields but also boast different strengths.
Given a $30,000 portfolio, I would invest in three TSX stocks. Together, those stocks can generate just over $1,400 in annual dividends. More importantly, they also provide some dividend growth, some monthly income, and stability.
Here’s a look at the trio of TSX stocks I would throw $30,000 at right now.
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Start with dividend growth and energy exposure
The first of three TSX stocks to own is Canadian Natural Resources (TSX: CNQ).
Canadian Natural is one of the largest energy companies in Canada, with a diversified portfolio of oil and natural gas assets. Those assets are slow-declining and low-cost, meaning that they generate ample free cash flow.
And that free cash flow is returned to shareholders in the form of dividends and share buybacks. In fact, Canadian Natural has amassed over two decades of annual increases to its dividend.
As of the time of writing, Canadian Natural pays out a quarterly dividend carrying a yield of 3.6%.
Add some higher monthly income
Another option for investors looking at some of the best TSX stocks to own is Slate Grocery REIT (TSX: SGR.UN). Slate owns a portfolio of U.S. grocery-anchored retail properties.
This immediately gives Slate two unique factors to distinguish it from many of the other well-known Canadian REITs on the market.
First, grocery-anchored retail is defensive. Necessity-based retailers such as grocers tend to generate more foot traffic when compared to discretionary retail providers. This generates a stable and recurring source of revenue for the REIT.
Second, the focus on the U.S. market is rare among Canadian REITs and offers investors exposure to a much larger retail-property market.
In terms of income, Slate pays a monthly distribution, which as of the time of writing, works out to a yield of 7.4%.
Add a dependable bank stock into the mix
Rounding out the three TSX stocks to own is Bank of Montreal (TSX: BMO). Canada’s big bank stocks are always some of the best long-term options for investors to consider.
In the case of BMO, investors are getting exposure to Canada’s financial sector from the oldest bank on the market. BMO has been paying dividends for nearly two centuries, making it one of the most stable payers on the market.
The bank offers a diversified business that spans personal and commercial banking in Canada, as well as a growing presence in the U.S. market. BMO also has established wealth management and capital markets operations.
As of the time of writing, that dividend carries a yield of 2.9%.
How this $30,000 TSX stock portfolio generates over $1,400 each year
Now that three stocks are selected, here’s how an initial investment of $30,000 can be split across those TSX stocks to generate over $1,400 each year.
Prospective investors who are not ready to draw on that income yet can choose to reinvest those earnings, allowing any eventual income to continue compounding until needed.
| Company | Recent Price | Amount Invested | Number Of Shares | Dividend | Total Payout | Frequency |
| Canadian Natural Resources | $68.05 | $9,500 | 139 | $2.50 | $347.50 | Quarterly |
| Slate Grocery REIT | $15.95 | $11,000 | 689 | $1.19 | $819.91 | Monthly |
| Bank of Montreal | $237.14 | $9,500 | 40 | $6.84 | $273.60 | Quarterly |
| Total: | $1,441.01 | Monthly | $120.08 |
