Royal Bank of Canada (TSX:RY)(NYSE:RY) is coming off a disappointing performance in 2019 where it only rose 10%, well below the 19% returns the TSX generated.
However, that’s also why it could be a great stock to hold for 2020; it’s not often that RBC underperforms the TSX. If we look at the past five years, the RBC’s 39% returns have soundly beaten the TSX, which is only up 16% during that time.
Investors have been bearish on financial stocks, especially in 2019, which can help make 2020 a year when RBC bounces back. A big test will come for the bank stock when it reports earnings next month that will help dictate which direction RBC’s stock will go in the early part of the year.
Ultimately, it’s hard to go wrong with holding one of Canada’s top bank stocks, and if there is a downturn in the markets in 2020, we could see investors flocking to safer, more stable investments such as RBC.
With a dividend of 3.9%, the income you can earn from holding the stock is another great incentive to invest in RBC.
Canadian Personal finance 