Stocks to buy given the market conditions

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Can the market/auction get any crazier? I took profit on several equities when I reached my number and watched them raise in value past that – not crazy but am now feeling a bit under invested….not quite FOMO but close.
However reviewing the market for an entry point in to something to stay invested (which judging from your attitude is the thing to do) the options look poor to me.
Every “good” company is up considerably from their last year numbers and so the fear I have is that an entry point at this time will become a price that will take a considerable time to recover from if the pricing falls. I am aware that Canadian stock have risen in value since the 60’s but struggling to find a company that either for growth or dividends is the right buy right now.
Advice? Thoughts?

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Asked on May 6, 2022 8:46 am
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Hey there. We've transitioned a bit away from pure-growth plays and have now started to focus on profitable companies that have suitable pricing power and moats to survive during a stagflation/high inflation environment. You'll see this in our most recent highlights of Waste Connections, A&W Royalty Fund, Automotive Properties, Goeasy Ltd etc. We have also recently highlighted Telus International that is definitely a pure growth stocks, but is also profitable and just posted a very strong quarter.

In my opinion, we want to focus on companies with pricing power, large economic moats, and rock-solid brands. Ones that will continue to post results in a stagflation or recession style environment. With that, the perfect example of these companies is our Foundational Stocks.

The one thing I would caution in this environment is I'd probably be averaging in. If I wanted to buy a particular stock right now, I'd probably be buying it in 3 or 4 chunks over the next 3-4 months. Markets are way too volatile for me to be dumping a ton of money in lump sum.

I know people want us to suggest the flavor of the week stocks right now that are performing well (say.... oil and gas for example as we did with XEG), however we want to stress that the success of a portfolio is going to be determined by the diversification of it over the long term.

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Posted by Dan Kent
Answered on May 6, 2022 1:17 pm