1 Passive Income Stocks to Counter Volatility


Image source: Getty Images.

The market fell sharply in 2022, all but erasing the post-COVID gains and excitement of just a few months ago. This sudden return to volatility has many investors worried, many of whom are looking for a viable stock that will counter volatility today and tomorrow.

Fortunately, there are excellent stocks in the market that accomplish this feat. Here’s one to consider adding to your portfolio right now.

What you need is a defensive investment…

In times of volatility, finding the right investments takes time and a lot of patience. For those new to investing, this can be downright confusing. This is just one reason why the need for a defensive stock that is largely immune to market volatility is essential.

This defensive stock to consider is ECB (TSX: BCE)(NYSE: BCE). BCE is best known as one of the largest and oldest telecommunications companies in Canada.

BCE’s telecommunications business offers wireless, cable, Internet and television services to subscribers across the country. These services, especially the wireless and Internet segments, have become indispensable in recent years.

This growth has only accelerated under the pandemic as more of us have moved to remote learning and working environments. Even better, some of this change has become permanent, only adding to what was already an impressive gap.

BCE is one of the largest telecommunications companies in Canada, and its massive infrastructure is unmatched by its peers. This puts the company in an advantageous position, and I haven’t even mentioned 5G.

BCE continues to roll out its 5G network across more of Canada. During the last quarter, this coverage reached 75%. Investors should note that 5G dramatically increases the speed and quality of downloads, which in turn will consume more data. As a provider of this data, this is a win-win situation for BCE.

Speaking of segments and ditches, let’s not forget BCE’s other Company. Besides its core subscription business, BCE also has a massive media arm. This media segment includes dozens of radio and television stations across the country, which are complementary to its core subscription business.

It looks like the perfect investment to counter volatility today and tomorrow. But wait, there’s more…

You can also earn a good income

Finally, let’s not forget that BCE’s subscription-based business generates a reliable monthly income stream, which is passed on to investors in the form of a dividend.

BCE has been paying dividends for over a century without fail. The company has also provided investors with nice annual hikes in this dividend, dating back more than a decade.

The current yield, which is paid on a quarterly basis, is 5.45%. This means that a $35,000 investment in BCE will yield an income of just over $1,900 in the first year. Factor in annual increases and dividend reinvestments, and that income will grow very quickly.

It’s the perfect answer to counter volatility today and tomorrow.

To counter volatility, you need to buy the stock

With the market appearing to be on the verge of a brake, some investors may be inclined not to invest at this time and wait for the market to end. This position is often supported by a feeling of fear.

Here’s the thing, though. When the market is at its lowest, what better time is there to buy? The current climate reminds me of Warren Buffet’s famous quote: “Be fearful when others are greedy and greedy when others are afraid.”

What we see now is that the market is scared. In other words, now is the perfect time to be greedy and buy good stocks like BCE at a discount.

Keep on going; be greedy.

Previous Alibaba's profit plummets nearly 60% as tech crackdown, Covid bite, Telecom News, ET Telecom
Next Telecom Consulting Market to See Huge Growth by 2027: IBM, Deloitte, Gartner