Yes, Canadian stocks prove to be a shelter to investments with its wide variety of natural resources and stable banking system.
Canada is a highly developed nation with a GDP of 1.64 trillion US dollars. It is not only the ninth largest economy in the world but also has a stable and diversified environment. The country boasts of its wide natural resources, robust industries, the most touted big 5 bank, and a stable monetary policy.
Canada has three main stock exchanges seven stock exchanges:
Toronto Stock Exchange (TSX): It is the prime stock exchange in Canada and is owned by the TMX Group. It dates back to 1861and functions in Canadian dollars.
TSX ventures Exchange (TSXV): It was formerly called as Canadian Venture Exchange prior to getting merged with the Vancouver and the Alberta exchanges. The merger happened in the year 1999 with a view to re-structure the Canadian stock market.
Canadian National Stock Exchange (CSE): This exchange was founded in the year 2003 and focuses on the small-cap and micro-cap companies of Canada. The exchange operates exclusively on electronic mode and has simple terms and conditions to get listed on the exchange.
The regular trading hours of the Canadian stock exchanges are from 9:30 am to 4:00 PM. The exchanges operate between Monday to Friday.
Here we have listed the reasons why one must venture into the Canadian stock markets:
Natural resources: Canada is blessed with extensive natural resources. It is wealthy in petrol (third largest in the world), coal (fifth largest in the world), iron ore, potash etc., These stocks perform well in Canada and provide a safe haven to investors who are looking to invest in commodities. Investing in commodities is one of the major tools of diversification and it can be used as a weapon against inflation. It is expected that there is always going to be demand for the natural resources unless the world decides to go back to the stone age. Hence, it is a safe house to park and grow your money.
The Banking and Financial System: The big 5 banks of Canada – The Royal Bank of Canada, TD bank, Canadian Imperial Bank, Bank of Nova Scotia and the bank of Montreal are considered to be safe and secure after weathering the global financial crisis better than other nations, in spite of Canadian economy, closely linked with the US.
Canadian stocks prove to be a shelter to investments with its wide variety of natural resources and stable banking system. However, any stock market is subject to volatility and market risk, especially with a recession looming in. Hence, it is important to diagnose your financial health, needs and objectives before penetrating into the markets.