Many Canadians save money every day and add it to their TFSAs to purchase stocks. But 2022 could be the year that the best opportunity is available.
We have seen some stocks recover this week. The selloff has been increasing all year. inflation continues to surge, despite the Bank of Canada and Federal Reserve’s best efforts to curb rising costs in North America.
And because of the highly uncertain and risky investing environment, it’s unquestionably resulted in a lot of stocks trading cheaply.
But while there are plenty of stocks that do trade undervalued, there are several, especially high-quality companies, that aren’t yet as cheap as they could be and could certainly fall further should market conditions worsen.
Sometimes the best is often the most TSX Because investors know how great stocks are, they can be bought and held in your TFSA. This is why these stocks tend to be more volatile.
You can still buy the top Canadian stocks at very affordable prices if you’re patient and wait for it to drop.
So, if you’re willing to wait for some of the top stocks to become even cheaper, here are two of the best to keep an eye on and buy if the market correction worsens.
This stock is a great defensive growth stock
If you’re looking for top stocks to buy for your TFSA, one I’d add to your watchlist immediately is Brookfield Infrastructure Partners (TSX:BIP.UN)(NYSE:BIP).
Brookfield is a very resilient stock. It has a portfolio that includes some of the most valuable assets such as utilities and pipelines. The portfolio also includes railroad tracks that are diversified in different countries. Therefore, much of Brookfield’s revenue is incredibly robust.
Brookfield is well-known for being a long-term growth stock. It’s constantly buying these defensive infrastructure assets while they are undervalued or if it identifies assets that it can grow organically itself.
This allows it to increase the cash flow from these assets, which in turn increases shareholder value. And once these assets have seen a turnaround and are much more profitable, Brookfield can look to sell them for a profit and recycle that capital into new undervalued assets it’s identified.
This is why it’s one of the best stocks to buy for your TFSA. It’s also why it hardly offers any discount, as it’s one of the most reliable stocks there is.
Should the market correction worsen, though, and even top stocks like Brookfield become caught up in the selloff, then there’s no question it would be one of the best stocks you can buy.
The best stock to invest in for your TFSA is the long-term one
In addition to Brookfield, another one of the best stocks you can buy for your TFSA, and one that’s unsurprisingly not that undervalued, is Enbridge (TSX.ENB)(NYSE.ENB), trading less that 10% from its high.
Enbridge, which is similar to Brookfield, is one of the most reliable stocks for your TFSA. Its operations are essential and therefore resilient. Enbridge has assets that are diversified across many different energy subsectors, which reduces risk even further.
Enbridge has a huge cash flow stream and is constantly increasing its dividend. It also invests in new growth opportunities such as renewable energy projects.
Therefore, considering the stock already offers an impressive dividend yield of 6.2% today, if it was to sell off significantly as the market correction picked up, there’s no question it would be one of the best stocks you could buy for your TFSA.