Royal Bank (RY.TO)

For the long term? Canadian banks are good to hold long-term. RY and TD are his picks in this sector, but it'll be a tougher environment with interest rates staying low in the coming years. He prefers Morgan Stanley because of its growth in wealth management. But banking overall will be tougher to make money for the next 5 years. But you own bank stocks for the dividend and will grow slowly in the coming decade.

Take profits now at $107? Canadian banks are a great space. RY pays nearly 4% and are well-capitalized. Great ROE. Low rates does pressure the banks, but RY has asset management and investment banking, too. Long-term, the banks enjoy a monopoly and will make money. True, there are bumpy periods like now. He also owns TD.

Canadian banks have gotten very cheap now. CIBC has a US presence but it’s mainly in Canada. RBC has more resources with a global presence. He thinks that banks are still a good place to be. Would be buying Royal Bank and TD.

Royal is a little more expensive than the other Canadian banks. The news of OSC charges on FX trading will create some headwinds -- requiring a fine to be paid. He owns TD instead right now as they have more exposure in the US.

TD-T vs. RY-T. TD-T is bigger than RY-T in the US. BNS-T is a bit cheaper. He is warming up to the sector in general.

RY-T vs. BAC-N. They are both leaders in their respective countries. In a non-registered account, use RY-T. Also he would go with them because in the case of recession, they can lower their expenses. Their plan is to invest in IT when times are good and pull back investments when they are not. Going forward it will be who can tighten their belts the most, will do the best.

Largest bank in Canada and largest company in Canada and one of the ten largest banks in the world. Well diversified. Core part of their portfolio. Well governed oligopoly. It operates the leading wealth management business in the country. They are leaders in digital and AI. Dividend yield is 4% and grows at a 7% clip a year. Very comfortable buying it now. (Analysts’ price target is $111.21)