The Canadian real estate market has been very difficult for first-time buyers to enter for many years now. The Canadian government has recognized this and created the First Home Savings Account (FHSA) in an attempt to make it easier for new buyers to enter the market. If you’ve never heard of this account, don’t feel too bad, since it was just released in April 2023.
For those that aren’t familiar, Canadians can think of the FHSA as a child account to the Tax-Free Savings Account (TFSA) and Registered Retirement Savings Plan (RRSP). Like the TFSA, any gains generated in an FHSA can be withdrawn tax free. However, Canadians can also reduce their income tax by contributing money into this account. With that kind of structure, it makes it very hard not to open one of these accounts.
It should be noted that Canadians that have been previously saving up for a home using their RRSP can apply withdrawals from an FHSA and an RRSP (through the home buyer’s plan) to the same purchase. That means any of those previous savings won’t be going to waste with this new account.
In this article, I’ll discuss two stocks that I would feel confident holding in an FHSA.
This is one of the best Canadian stocks around
If I could only choose one stock to hold in a FHSA, it would be Constellation Software (TSX:CSU). This company has been one of the best-performing TSX stocks since its initial public offering. Over the past 17 years, Constellation Software stock has gained more than 14,000%. That means a $10,000 investment would be worth more than $1,000,000 today.
It’s generally accepted that companies won’t be able to grow as fast as they once did, as they continue to grow in size. However, despite Constellation Software’s outstanding previous growth, this company appears to not be slowing down whatsoever. Over the past year, Constellation Software stock has gained more than 33%. If you managed to buy shares when the stock was at its lowest point in November 2022, then you’d be sitting on a 40% return.
Still led by its founder, Mark Leonard, Constellation Software seems like a no-brainer for the new FHSA. This company has found a way to perfect its acquisition strategy and I think investors should heavily consider buying this stock today.
A reliable company for your portfolio
Canadian National Railway (TSX:CNR) is another stock that first-time home buyers should consider investing in today. Over the past year, Canadian National stock has managed to gain more than 12%. Looking out to a longer timeframe, investors would be able to see that Canadian National stock has gained about 60% over the past five years.
As far as industry leading companies go, very few names in Canada are as impressive as Canadian National. This company operates nearly 33,000 kilometres of track which spans from British Columbia to Nova Scotia. That wide reach has helped it become one of the most recognizable companies in the country. With a fairly stable business behind it, I think Canadian National would be a great addition to your FHSA.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
