When you are new to investing, it is smart to diversify your stock holdings. When you start out, you don’t exactly know your investing style or strategy. You don’t yet know what kind of stocks or investments resonate with your personality or lifestyle.
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Diversify until you find your style
It is important to experiment with a mix of strategies. That might mean buying a mix of indexes, exchange traded funds (ETFs), and stocks.
You might own a mix of dividend, growth, and value stocks in an array of different industries, sectors, and geographies. Over time, you will find a strategy that works for you.
However, if you put all your cash into one stock or investment, you are effectively putting all your chips on one opportunity. If you are right about the investment, the payoff can be good. Yet, what if you are wrong? It can be disastrous.
Hedge your bets across a few investments
You don’t want your hard-earned savings to go down the drain on one bet that didn’t work. That is why it is smart to spread your bets out at first. If you are starting with $1,000, split it into three to four different investments that give you exposure to different areas.
If I was starting out, three stocks I would split among $1,000 are AltaGas (TSX: ALA), Descartes Systems (TSX: DSG), and MDA Space (TSX: MDA).
AltaGas: A top dividend growth stock
AltaGas gives an investor exposure to a mix of regulated and contracted income. Half its business is from a steady U.S. natural gas utility that also happens to be growing in the high single-digit range. The other half of its business is a liquefied petroleum gas (LPG) midstream and export business.
With energy disruptions in the Middle East, Asian demand for LPG is soaring. As Canada’s largest exporter, AltaGas should enjoy an uptick in pricing and volumes in the years ahead.
AltaGas is a great long-term bet on energy demand. This stock yields 2.4%, and has an attractive mid-single digit dividend growth trajectory.
Descartes Systems: A top Canadian tech stock
Descartes provides specialized network and software solutions to the logistics industry. There is a lot to like about this business. It is unlocking vast swaths of data into AI solutions that specifically cater to customer needs. The company is aiming to grow by 12% to 15% annually.
This company earns very high margins and generates tonnes of cash. Even after making more than $200 million in acquisitions in 2026, it is still sitting with a substantial cash balance. Descartes’ valuation still looks attractive after it pulled back earlier this year.
MDA Space: Canada’s best space play
If you want exposure to more of an exciting theme, MDA Space is an interesting stock. It is the largest space-related company in Canada. It is focused on providing satellites, space robotics, and earth observation services.
MDA has established expertise and a geographic footprint across Canada, the U.S., and Europe. It is set to win from an increase in defence and private communications spending.
It has a large backlog and huge opportunity pipeline. MDA stock is down 8% in the past month. The stock valuation looks interesting and is worth considering adding to a portfolio today.
