Feb 20, 2013

Canadian Bank Stocks Always a Great Option


If you're someone that is looking for higher returns than what your bank offers in Savings Accounts or GICs, you may have looked into the stock market. However, the potential volatility may have turned you the other direction. Look no further than the Canadian Banks.

Unlike banks in the USA, Canadian banks are moderately regulated, making them much more risk adverse. However, they continue to grow; most recently by taking advantage of the weaker economy by completing international acquisitions. Essentially, the Canadian banks are "taking advantage" of the opportunities that are presenting themselves from other banks not recovering as quickly from the recession. Bank of Nova Scotia has most recently purchased a 51% stake in Columbian bank, Banco Colpatria Red Multibanca Colpatria SA. The acquisition totalled around 1-billion dollars. They are also waiting on China's approval to purchase nearly 20% of Bank of Guangzhou for 719-million dollars. 

The Canadian banks have demonstrated resilience from market volatility, with most yielding over 30% over the past 3 years. They also offer very attractive dividends between 3.65% and 4.55% per year.

If you're willing to look outside of standard investments like GICs and Savings accounts, don't be afraid of the stock market. You can always take a cautious step in.

2 comments:

  1. Being around you this year made me think about looking into stocks so its nice to likely have a starting place. Thanks,

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