RRSPs are a great way to hold these six U.S. dividend stocks

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RRSPs are a great way to hold these six U.S. dividend stocks GlobeInvestor

Cedar Fair, which operates 13 amusement parks including Canada’s Wonderland, is an attractive investment because that line of business is fairly stable with high barriers to entry. THE CANADIAN PRESS/Richard BuchanU.S. dividend stocks can be appealing for income and diversification, but they are best parked in a registered retirement savings plan .

This move allows Canadian investors to avoid the 15-per-cent withholding tax the U.S. government imposes on the dividends that U.S. companies pay out. That tax applies to these securities in non-registered and tax-free savings accounts. Unlike Canadian dividends, which qualify for a reduced tax rate in a non-registered account, U.S. dividends don’t get special treatment. They are fully taxable.We asked three portfolio managers for their top U.S. dividend stock picks for an RRSP.

Aubrey Hearn, head of equities, vice-president and senior portfolio manager, Sentry Investment Management, a division of CI Investments Inc.KKR, a global private-equity firm with more than $200-billion in assets, is benefiting from a demand for alternative investments in a low interest rate environment, Mr. Hearn says. “Since 2005, it has grown its assets at about a 17-per-cent compounded annual growth rate.” New York-based KKR’s clients include sovereign wealth and pension funds.

 

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