RRSP Investors: 3 Canadian Stocks You Should Hold in Your Retirement Portfolio

Anyone saving for retirement would be wise holding these three market-leading Canadian stocks in their portfolio.

| More on:

When building a portfolio of Canadian stocks for your retirement savings, I’d suggest keeping growth top of mind. The magic of compound interest can turn what may seem like a small amount of money today into a hefty-sized nest egg by the time you reach retirement.

If you’re going to depend on compound interest to reach your retirement savings goal, which many of us are, it’s important to keep track of your annual return. A difference of just 1% in annual returns each year can have a significant impact on your total savings in the long term.

Since I still have decades until my retirement, my portfolio currently skews more toward growth stocks. To balance out some of my high-growth tech holdings, I do own a few dependable blue-chip companies.  

For anyone looking to build a retirement portfolio, I’ve put together a perfect basket of Canadian companies to start with. The three picks can provide investors with diversification, growth, and passive income. 

Brookfield Asset Management

Owning shares of Brookfield Asset Management (TSX:BAM.A)(NYSE:BAM) provides a portfolio with instant diversification. The asset management company owns and operates businesses across a range of different industries. Not only that, but it also has an international presence.

Even with such a broad portfolio of assets, the Canadian stock has managed to deliver impressive growth to its shareholders. Shares are up more than 150% over the past five years, compared to the S&P/TSX Composite Index’s return of less than 50%. It’s also up 50% year to date, which is more than double what the Canadian market has returned.

Brookfield Asset Management may be valued at a market cap now over $115 billion but I don’t think this Canadian stock is anywhere near done outperforming the market. 

Shopify

Not only is Shopify (TSX:SHOP)(NYSE:SHOP) the largest company in the country, but it’s also one of the most expensive. The tech stock is trading at a lofty price-to-sales ratio of 50. 

It’s remarkable the growth that Shopify continues to deliver when looking at the size of the company. The Canadian stock is valued at a market cap of $250 billion and is coming off a quarter where year-over-year revenue growth was up nearly 50%. 

I’d argue that Shopify is past its high-growth days. After all, shares are up more than 6,000% since the tech stock went public in 2015. But with revenue growth still soaring and the e-commerce opportunity showing plenty of upside, I strongly believe this high-priced growth stock is worth paying up for.  

Toronto-Dominion Bank

Last on my list is a high-yielding dependable Canadian bank. While Toronto-Dominion Bank (TSX:TD)(NYSE:TD) is no stranger to outperforming the market, growth isn’t the main reason I’d suggest owning it in a retirement portfolio. 

The major banks have been some of the most dependable investments for Canadians for decades. They likely won’t be the fastest-growing Canadian stocks in your portfolio but that’s no reason to not own one. TD Bank can help balance out the volatility in your portfolio if you’re planning on owning growth stocks, like Shopify. 

In addition to that, TD Bank can be a passive-income generator for your portfolio. At today’s stock price, TD Bank’s annual dividend of $3.16 per share yields 3.4%. And once you factor in share price appreciation, this slow-growing Canadian bank can definitely be a market-beater for your portfolio over the long term.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Nicholas Dobroruka owns shares of Shopify. The Motley Fool owns shares of and recommends Shopify. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV.

More on Tech Stocks

cloud computing
Tech Stocks

3 No-Brainer Tech Stocks to Buy With $1,000 Right Now

These three Canadian tech stocks could be among the best growth opportunities in the market right now.

Read more »

happy woman throws cash
Tech Stocks

3 Growth Stocks That Could Be Long-Term Wealth Creators

These three growth stocks aim to grow their financials at a higher rate than the industry average, thus delivering superior…

Read more »

The virtual button with the letters AI in a circle hovering above a keyboard, about to be clicked by a cursor.
Tech Stocks

Is POET Technologies a Top AI Stock for Canadian Investors?

Canada has relatively few AI stocks, and the ones it has are different from American AI stocks in terms of…

Read more »

Rocket lift off through the clouds
Tech Stocks

2 Growth Stocks That Could Skyrocket in 2025 and Beyond

Wondering what types of stocks could rapidly rise in 2025? Check out these two stocks with substantial upside if they…

Read more »

up arrow on wooden blocks
Tech Stocks

The 3 Smartest Tech Stocks to Buy With $500 Right Now

Tech stocks can be seen as a bit risky, but these three have far less risk and more stability for…

Read more »

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Tech Stocks

Shopify: A Must-Have Growth Stock for Your TFSA Now (and the Next 10 Years)

Shopify (TSX:SHOP) stock isn't just a top growth company, it's a titan worth owning in your decades-long TFSA fund.

Read more »

cloud computing
Tech Stocks

Best Stock to Buy Right Now: Manulife vs CIBC

Want the best stocks? These two are certainly the best options. But which is the better buy?

Read more »

profit rises over time
Tech Stocks

4 Reasons to Buy Constellation Software Stock Like There’s No Tomorrow

Constellation Software stock continued its climb upwards after recent earnings, and this only adds to its appeal.

Read more »