Portfolio safety can are available many varieties, from particular person inventory picks with defensive traits to investing in particular index funds with obese publicity to sure key defensive tendencies within the coming yr.
I believe some passive investing by way of ETFs is all the time an excellent technique, and that’s core to my private investing mantra. Nonetheless, for inventory pickers on the market (and who doesn’t like to choose winners), I’ve additionally obtained a number of potential winners within the New Yr I believe traders would do nicely to think about right here.
With that stated, let’s dive into two high Canadian shares I believe can present ample draw back safety for these considering long run.
Boyd Group
With the common age of automobiles on North American roads persevering with to extend (and there are expectations this development will proceed for a while), former development inventory champion Boyd Group (TSX:BYD) is one in every of my high concepts for 2026.
The thesis round this firm is comparatively easy. If car house owners hold their automobiles in use for longer, there’s going to be a higher impetus to repair up their autos and hold them working than tackle a brand new auto mortgage with a sky-high charge. And since new and used autos at the moment are amongst their most costly ever (with the common new car costing a bit of greater than US$50,000 a pop), this can be a development I believe will likely be in place till costs or rates of interest come down meaningfully.
I don’t count on both to be the case in 2026, so Boyd Group (one of many largest auto physique operators in North America) stays a strong wager. As the corporate continues to consolidate this fragmented trade and enhance its pricing energy (and margins), I believe the inventory’s muted year-to-date achieve of three% might be the shopping for alternative long-term traders are on the lookout for.
RBC 1–5 Yr Laddered Canadian Bond ETF
One other key possibility I believe Canadian traders can contemplate for significant upside if rates of interest come down (but additionally portfolio safety within the occasion equities slide general) is the RBC 1–5 Yr Laddered Canadian Bond ETF (TSX:RLB).
This ETF offers traders with publicity to short-duration Canadian bonds. Thus, for many who assume the brief finish of the yield curve is more likely to proceed to return down as Tiff Macklem and the Financial institution of Canada proceed to drop charges, that is the way in which I’d go to play this development.
With a present dividend yield of three.2% and a short-duration bond portfolio, traders received’t see significant swings from long-term rates of interest. Lengthy-term charges can nonetheless fluctuate as a result of tariff, commerce, or macroeconomic issues, which have impacted this sector up to now. In different phrases, I consider this ETF as one of many safer methods to play declining yields over the course of the approaching years.
Importantly, this ETF offers this yield in laddered kind, offering extra constant earnings for these seeking to generate such yield, which could be reinvested in different property over time. As an alternative of parking one’s money as money throughout the portfolio, that is the way in which to remain invested and earn yield whereas ready for higher alternatives to come up.
