Europe – a tale of two halves

I was listening to a fund manager discuss the current situation in Europe and he pointed out how different is the reality in Europe from the perceptions held by many people.  The fact is that in the more developed European countries, corporations are often in excellent shape.  While their head office may be based in [...]

Equity mutual fund investors cost themselves $106B

Evidently many so-called investors have not realized it, but the U.S. equity market has approximately doubled since the panic lows of March 2009.  I say they are so-called investors because they evidently do not understand the difference between investing and speculating.  Investing consists of making careful, patient, long-term, strategic decisions to invest in assets whose [...]

Managing retirement income with a fixed income wedge

Just as dollar cost averaging can work to help you build assets for retirement, it can also work against you when you need to be spending your assets during retirement.  In retirement your goal is no longer purely long-term, but also includes an element of short-term spending.  Just as your time horizon is the most important [...]

Mutual Funds 101 Booklet

Dynamic Funds has created an easy to read booklet explaining many of the basics of mutual funds.  To give you an idea of what is in the booklet, I have copied its table of contents below. Mutual funds: What they are and how they work 1. History of Dynamic Funds 2. Why invest in a [...]

How to improve your returns

If you think most people are rational investors, think again. Financial services market research firm DALBAR has surveyed individual households for more than 20 years and created their Quantitative Analysis of Investor Behavior (QAIB). This measures the returns of the S&P 500 Index against the returns of the individual investor. Here are two surprising facts: The [...]

The only four equity portfolios

Once you have dealt with the basics of identifying that a) equity investments are necessary to protect retirement income from the ever-rising cost of living; and b) diversification is essential to avoid permanent losses you can see that there are really only four ways to manage that equity portfolio, as shown in the diagram below. [...]

Wherefore art thou Dividends?

The question of dividends when it comes to mutual funds is a tricky one, so let me try and share some perspective that I have gained over the last 18 years in the financial business.  I will try to explain the role and importance of dividends paid by individual companies and why this is a different [...]

Mackenzie Ivy Foreign Equity Fund money manager report

On December 7th I participated in a conference call with the team that manages the Mackenzie Ivy Foreign Equity Fund.  The fund has been among the best global equity funds over a long period and has done so with much lower than average price volatility.  Since the beginning of the tech decline in 2000, the [...]

Mackenzie conference report

In May 2011 I attended Mackenzie University, a full-day professional development seminar and in September 2011 I attended the annual Mackenzie Due Diligence conference, a full-day session where several money managers and tax and estate planning experts provide perspectives, updates and educational content.  In no particular order, here are some notes I made, divided by [...]

Why should you invest globally?

1. Greater diversification The Canadian stock market has three dominant sectors that make up 78% of the entire index: energy, materials and financials.  Energy and materials are really all about natural resources. The global stock market is much more balanced, with greater representation in areas such as consumer staples, health care, information technology and comsumer discretionary. [...]

Crises are inevitable, so what to do?

Every day when you open the newspaper, turn on the radio or TV news, or surf the internet, you will find at least one story about a natural disaster, political, economic or financial crisis that you could choose to worry about.  This worry can negatively affect investment decisions that you make.  What many investors ignore [...]

What do we know about the current market mood?

As the title of this article indicates, my intention is to distinguish the market mood from several important facts.  The emotions of market participants is subject to change every moment of every day, causing them to change their outlook on the future value of businesses.  If people worry about the future, their appraisal of the [...]

Trimark – 30 years with the same style

In September 2011 the Trimark Fund and Trimark Canadian Fund turned 30. This is remarkable and almost unique because most funds are relatively new and even fewer have followed the same management style for so long. As current Trimark Fund manager Dana Love said in a recent interview “The investment process is consistent across the [...]

AGF Money Manager Report August 2011

In a recent conference call featuring four AGF money managers to discuss the issues of U.S. and European government debt levels, Rory Flynn of AGF International Advisors (AGFIA is the manager of AGF Global Value, AGF International Stock, AGF European Equity) had the following comments: 1. European equities in general are trading at the extreme low end of their historical [...]

Should I be calm or panic?

A client asked me how panicky my clients are with the current economic situation.  I was struck by the question since I do not feel any panic nor are clients bombarding me with queries indicating panic or any sort.  Here was my reply. I don’t think my clients are panicky at all. I hope they [...]

Irrational investors, rational conclusions

  There was an interesting article in the National Post written by Peter Hodson, about how investors think the stock market is irrational.  He points out that the average investor behaves in a way contrary to their financial health by buying and selling at the wrong times.  He also points out that if there is [...]

Think before firing that fund manager

Michael Nairne wrote an article in the National Post that provides healthy advice about the consistent tendency of investors to change mutual fund managers at the wrong time, for the wrong reasons.  For many years I have emphasized to clients how important it is to make rational, careful selection of fund managers before investing with them, [...]

Why on earth would you buy that?

At a recent presentation by one of the Mackenzie Cundill fund managers, he described how he had been attracted to the US banking sector in recent months.  He described it as “a bad industry in a bad country at a bad time”.  At least, that’s what the headlines read and what many commentators think.  His [...]

Warren Buffett quoted on gold

“You could take all the gold that’s ever been mined, and it would fill a cube 67 feet in each direction. For what that’s worth at current gold prices, you could buy all — not some — all of the farmland in the United States. Plus, you could buy 10 Exxon Mobils, plus have $1 [...]

Globalization: how great companies do not depend on domestic markets

Every day the news carries articles about the weak performance of the United States economy compared to the emerging markets of the world.  Worried that the bad news will continue ad-infinitum, many investors thus shy away from investing in companies based in the USA.  What they are missing is that the USA is also home to [...]

Buy American. I am. – Warren Buffett

October 16, 2008  New York Times The financial world is a mess, both in the United States and abroad. Its problems, moreover, have been leaking into the general economy, and the leaks are now turning into a gusher.  Read the full article here.

Where are we in the context of history?

 $882,337 – that is the level the line for U.S. stocks on the chart below would have been at on Dec. 31, 2010 if stocks were valued at their historical average. Since the level is only at $699,088 you can see that stocks would need to rise 26% after inflation to regain the average level [...]