Given some of the risks, it is wise to diversify and spread your investments widely. If I had $20,000 to invest, I would split it into five $4,000 stocks. Here’s how I would structure my portfolio.
AltaGas: A solid Canadian dividend stock
I would first look for a defensive anchor to counteract any market volatility. A dividend stock such as AltaGas (TSX:ALA) looks well positioned today.
It has a growing US utility business that provides a predictable regulated revenue stream. It also has multiple growth opportunities through its Canadian midstream operations. Asian demand for its propane exports continues to increase. Improved natural gas prices will certainly contribute to the return prospects for 2026.
It targets earnings and dividend per share growth of 5 to 7% over the next five years. It yields 3.2% today.
Dream Industrial REIT
Dream Industrial REIT (TSX:DIR.UN) is another way to passively earn income with little risk. It has a large portfolio of industrial properties in Canada and Europe. It has an occupancy rate of 95% and long-term leases.
A recent joint venture transaction shows that this stock is still trading at a large discount to its private market value. The stock is still relatively cheap. It currently delivers an attractive distribution yield of 5.4%.
Calian group
Calian group (TSX:CGY) is in an enviable position in 2026. It is a major provider of healthcare, training and satellite services to the Canadian military. Today, more than 50% of revenues are related to defense. Given the recent attention from activists, it is likely that defense operations will become an even bigger part of its activities.
Calian’s shares have been underperforming for a few years. That should change, however, as the Canadian government’s and NATO’s recent defense spending commitments begin to turn into contracts. This company trades at a reasonable valuation given its growth prospects.
Topicus.com
Software stocks have been demolished over the past seven months. Many believe AI could be a terminal threat. However, this could be a big opportunity if these threats do not materialize.
Topicus.com (TSXV:TOI) consolidates small niche software companies across Europe. These markets are less likely to be pursued by AI disruptors given their small total addressable market. Likewise, Topicus can use AI applications to accelerate development and add more services for its customers.
This is a company that will grow into the mid-teens by 2025. Yet it currently trades with a free cash flow yield of 10%. You may have to be a contrarian, but this seems like a great long-term purchase.
Stantec: A strong Canadian composite stock
Stantec (TSX:STN) has turned into a solid Canadian compounder stock. It has increased by almost 200% over the past five years. It has grown into an important player in the field of technology, architecture and environmental advice.
In 2025, Stantec has seen its margins improve. The backlog has increased by almost 15%. Organic growth remained over 5% and acquisitions contributed 7%.
This stock is down 8% in the past six months. While this Canadian stock is still expensive compared to peers, its growth and margin prospects likely merit a small premium.
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