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As the S&P 500 continues its upward trajectory, reaching nearly 9% gains this year, investors are met with the dilemma of entering the market at all-time highs. The question of a potential market correction looms, but some seasoned investors emphasize the importance of time in the market over timing the market. In this article, we'll explore two stocks that remain compelling choices for your Registered Retirement Savings Plan (RRSP) despite the market's elevated levels.
For those unfamiliar, Constellation Software may not be a household name, but it stands as an exceptional investment opportunity. Unlike popular tech stocks with consumer-facing businesses, Constellation Software operates in the realm of acquiring vertical market software (VMS) businesses. The company not only acquires these businesses but also empowers them to become exceptional units within its portfolio. With a successful acquisition strategy since the 1990s, Constellation Software has steadily grown by acquiring hundreds of businesses.
The staggering success of Constellation Software reflects in its stock price, soaring nearly 20,600% since its listing in 2006. Investing $10,000 in this stock before 2008 would have transformed you into a millionaire today. Despite the recent 16.4% gain this year, historical performance suggests that Constellation Software is capable of even more. This is why investors continue to add shares to their portfolios, recognizing the long-term potential of this often overlooked gem.
Amid concerns about a potential market correction, Shopify stands out as a resilient contender in the global e-commerce space. Positioned as a leader, Shopify provides merchants of all sizes with a comprehensive platform and essential tools for operating online stores.
Despite the debates about the company's trajectory, Shopify posted impressive results in 2023, with revenues reaching US$7.1 billion, marking a substantial 26% year-over-year increase. Furthermore, Shopify's market share in the massive U.S. e-commerce market has surpassed 10%. As the company continues to demonstrate robust growth, skeptics may need to reconsider their views. Investors, even in the face of a high-flying S&P 500, recognize Shopify's potential for ongoing success, making it a stock worth adding to your RRSP.
In conclusion, while market highs may raise concerns, strategic investments in fundamentally sound companies like Constellation Software and Shopify prove that opportunities exist even in elevated market conditions. As you consider your RRSP portfolio, these resilient stocks present compelling cases for long-term growth, emphasizing the resilience and adaptability of well-established companies in the ever-changing market landscape.
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