You’re not alone in wanting to invest in Canadian stocks — over 6 million Canadians now hold direct equities. And with a stable economy, strong banks, world-class resources, and global brands like Shopify and RBC, it’s no wonder investors are betting on homegrown companies.
Maybe you’re feeling patriotic. Maybe you’re just tired of watching your money sit still in a savings account. Either way, investing in Canadian stocks is one of the smartest ways to build long-term wealth — right here at home.
How to buy Canadian stocks and invest in Canadian companies
There are a few options you can choose from when picking a brokerage account. Each of the big bank’s offer brokerage accounts so, if you have an account with one of them, you can open a brokerage account to make trading as seamless as possible. However, there are some other trading companies that have emerged, offering more competitive fees. These include Questrade, Wealthsimple and Interactive Brokers.
Before choosing a brokerage, figure out how much you’ll be charged for using their services. They may charge trading commissions (fees for trades that are made), account maintenance fees (a yearly or monthly charge for keeping the account open), inactivity fees (the cost of not using the account) and deposit and withdrawal fees. Fees vary depending on each brokerage account, so take a look at the fine print before starting your trading journey.
After you’ve opened your account, you’ll have to figure out how to deposit funds. This cash will be used to purchase stocks. If you have a regular bank account with the same financial institution as your brokerage account, you’ll likely be able to transfer funds from account to account. It’s easy to transfer money from your bank to a different brokerage account as well, though. You can e-transfer money in seconds or you can connect your account and deposit funds when you need it.
Each brokerage has its own trading platform, but the general premise is the same, no matter which one you use. You can search a company name or symbol (Google or Goog, for example) and evaluate its performance directly in the platform.
Things to look for include 52-week highs and lows, the dividend (how much, if anything, is paid out in dividends to investors), the P/E ratio (a company’s stock price compared to its earnings per share) and more.You can also look at a company’s earnings report to get a sense of expected future performance, evaluate the industry they operate in (is it one that’s expected to perform well in the future?) and take a look at its competitors. Is it leading its industry? That’s a good sign for future investment growth.
After purchasing a stock, you’ll want to monitor its performance. Decide how long you’d like to hold it and make a strategy for when you’d like to sell or purchase more. If you decide to hold a particular stock for the long-term, you won’t need to check its price daily. However, if it’s a stock you’d like to make a quick return on, you’ll want to stay on top of its price fluctuations.
Why invest in Canadian stocks?
Canada has historically had a stable economy and a strong financial sector, making it a great country for companies to do business and grow in. We’re also home to a solid natural resources industry, like oil and gas, mining and forestry. Strong trading ties also help grow our economy.
The Toronto Stock Exchange (TSX) is one of the world’s top trading exchanges. We’ll get into more detail below but, investing in the TSX gets you access to thousands of companies, including the big banks, Shopify, Enbridge and other global leaders.
What is the Toronto Stock Exchange (TSX)?
Stock exchanges are marketplaces for where investors and traders can buy and sell equities. Canada has its own stock exchanges, including the TSX, which just so happens to be the 10th largest exchange in the world and the largest in Canada. The TSX is a favourite among investors for many reasons. It’s all electronic, making buying and selling stocks super simple, all transactions are done in Canadian dollars – a big benefit for Canadian investors – and it has more than 1,500 companies listed.
So, yeah, you could say it’s kind of a big deal.
You can buy and sell different kinds of securities on the TSX, including stocks, ETFs and bonds that span dozens of sectors, including energy, finance, telecommunications, utilities, industrial and more. There’s also the TSX Venture Exchange (TSXV), an exchange that focuses on early-stage businesses. It’s a great place to find up-and-coming companies that might be the next big thing.
Related read: Best ETFs in Canada
Best Canadian stocks to consider
What’s considered the best Canadian stock is a matter of opinion. However, we’ve put together a list of some of the top stock options on the TSX to help you decide which stocks make the most sense for your investment dollars. Keep in mind, this isn’t financial advice. You should do your own research on any company whose stock you plan to purchase. That said, here are some typically reliable stocks you can consider.
Royal Bank of Canada (RY)
Banks are known to be conservative in how they run their businesses, which is good news for investors who are worried about the ups and downs of the market. As Canada’s oldest bank, RBC is likely here to stay, so investors should expect years of solid performance from its stock.
In 2024, RBC purchased HSBC, giving it a stronger global presence. This, like many strategic moves before it, is viewed as a savvy one by the big bank. Overall, RBC is viewed among investors as a company with strong financials and a satisfied customer base.
TD Bank (TD) Another option in the financial sector is TD Bank. With a revenue of $14.2 billion in the last year (+8.9% year-over-year), it’s viewed as a stable and well performing company. It is, however, dealing with money laundering allegations, which is something to take note of as an investor.
Related read: Best Canadian bank stocks
Enbridge (ENB): Investors interested in dividends might want to consider Enbridge. It has raised its dividend every year for the past 29 years and current investors will enjoy a 6% dividend yield. Recently, Enbridge purchased three natural gas utilities to the tune of USD$14 million, a sign that it’s poised for future growth.
Suncor Energy (SU): Suncor is a stock to consider if you’re bullish on Canada’s oil market. Some experts believe Suncor is at its current price peak, but the oil industry tends to fluctuate based on various worldwide macroeconomic factors. It’s a good idea to keep an eye on stocks like Suncor to determine if and when it’s a good time to purchase stock.
Shopify (SHOP): Shopify posted 20.7% year-over-year revenue growth in Q2 of this year. Its gross profit margin also increased to 51.1% from 49.3%. Experts believe Shopify has potential for continued growth in the future, making it a company to keep an eye on.
Related reads: Best tech stocks & Best AI stocks
Fortis (FTS): When it comes to defensive stocks, few offer the sort of stability that utilities companies do. After all, people need to heat their homes, even in times of economic stress. Fortis, with its dividend yield of 4%, is a strong candidate to add to your portfolio if you’re looking for a stable stock.
Related read: Best Canadian utility stocks
Alimentation Couche-Tard (ATD): While not a household name in Canada, Alimentation Couche-Tard is a global leader in convenience stores. It has nearly 17,000 stores across the world, including Canada, the US, Mexico, Ireland, Norway, Japan, China and more. Overall, it’s viewed as a well-run company that posts solid profitability year-over-year.
Related read: Best retail stocks
ETFs for Canadian stock investors
If stock picking seems too intimidating, you might want to consider investing in Canadian Exchange Traded Funds (EFTS). ETFs combine a number of different securities into one investment. Think of it like a basket of stocks and bonds. The advantage of ETFs is that they have built-in diversification, since they comprise more than one investment. ETFs can be bought and sold on exchanges like the TSX, similar to individual stocks. The advantages, along with diversification, include low fees and, in some cases, lower risk. Similar to Canadian stocks, there are Canadian ETFs you can consider, including:
- iShares S&P/TSX 60 Index ETF (XIU): Comprises large Canadian companies like TD, RBC, Shopify, Enbridge and more
- Vanguard FTSE Canada All Cap Index ETF (VCN): Similar to the iShares ETF, comprises dozens of large Canadian companies including big banks, energy companies, industrials, technology and more
- BMO Equal Weight Banks Index ETF (ZEB): A straightforward ETF that comprises Canada’s big six banks
ETFs are a great way to own securities from several different companies all within one investment. There are ETFs for specific goals as well, like long-term growth, fixed-income ETFs and index ETFs. No matter your investing style, there are ETFs that fit your strategy.
Related read: Best ETFs for Canadian Investors
Key considerations when investing in Canadian stocks
Before you jump into Canadian stocks, here are a few important things to think about:
- 1 Currency matters: If you’re investing from outside Canada, currency fluctuations can impact your returns. For example, if you’re buying Canadian stocks using US dollars and the Canadian dollar weakens, your investment could lose value — even if the stock itself goes up. It works the other way too. Currency risk is real, especially if you're holding assets outside your home country.
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2
Taxes on dividends: Taxes hit differently depending on where you live and what you're investing in. If you're a Canadian investing in U.S. stocks, expect a 15% withholding tax on dividends when held in a regular (non-registered) account, thanks to the U.S.-Canada tax treaty. But if you hold those U.S. stocks inside your RRSP, that tax is typically waived. TFSAs don’t get the same break, so you’ll still be taxed even though the account is tax-free in Canada.
Now flip the script.
If you're an American investing in Canadian stocks, Canada usually withholds 25% of any dividends paid to non-residents. However, the Canada-U.S. tax treaty cuts that rate to 15% if you file the right forms and hold the investments in a taxable brokerage account. Like always, consult a tax pro to make sure you’re getting any treaty benefits you're eligible for. - 3 Sector exposure and diversification: The TSX leans heavily on banks, energy, and mining. That’s great if you want solid dividends and exposure to natural resources—but it can also mean less growth compared to tech-heavy markets like the U.S. To build a well-rounded portfolio, consider mixing sectors or adding ETFs for instant diversification.
- 4 Do your research: Canada has thousands of public companies. To research them properly, use tools like SEDAR+, where you can find financial reports, regulatory filings, and other key documents. It's your go-to for checking a company’s history, leadership, or whether it’s been flagged by regulators.
Alternative ways to invest in Canadian stocks (for U.S. investors)
If you're in the U.S. and want to invest in Canadian companies, you don’t have to open a Canadian brokerage account or worry about converting currencies. Here are a few simpler ways to get started:
- 1 American Depositary Receipts (ADRs): Some Canadian companies, like Shopify, trade on U.S. stock exchanges as ADRs. These are basically U.S.-friendly versions of Canadian stocks. You buy them in U.S. dollars through your regular brokerage account — no currency exchange or international trading required. ADRs also make it easier to handle dividend payments and U.S. tax reporting.
- 2 Canadian equity mutual funds: If you want a professional to manage the details, look for mutual funds that focus on Canadian stocks. These funds typically hold companies in sectors like banking, energy, and natural resources. Just be aware: mutual funds often charge higher fees than ETFs.
- 3 Global or international ETFs: Want exposure to Canada and other countries? Global ETFs might be the way to go. These funds include Canadian companies as part of a broader portfolio, giving you diversification across multiple countries. One popular example is VEQT, which includes Canadian, U.S., and international stocks all in one low-fee ETF.
Next steps to start investing
There’s a lot to love about investing in Canadian companies using the TSX. And, it’s super simple to get started.
Alternatively, you can easily open a brokerage account online with your current bank’s app. Either way, you can get started trading stocks.
FAQs
Justin is a writer and editor who has been covering personal finance for over 10 years. He's written for companies such as KOHO, Ratehub, BMO, Zoocasa, and Questrade, among others. Justin also created a course in Content Creation, which he taught at York University for four years. When not writing, Justin can be found at a live concert, on the golf course, riding a motorcycle, or sailing.
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