Cutting Through the Noise
November 24, 2011
With the holidays around the corner, shopping is in the spotlight. It got me thinking … We’re used to high price tags on the wet coast. We’ve got the most expensive housing market in Canada (if not the world, based on some measures). A bottle of...
Read MoreNovember 21, 2011
A dirty little secret in this business: when a fund has an ugly performance record, it can be buried by merging it into another fund. Fund mergers occur all the time (see Fund Company Calls the Cleaner). The latest track records to be swept under the rug belong to a handful of under-performing Investors Group funds. Given...
Read MoreNovember 16, 2011
Morningstar Canada published its updated Stewardship Grades for 26 fund companies yesterday. The grades are designed to help investors further research, identify, and compare fund companies that do a good job – or a poor job – of aligning their...
Read MoreNovember 9, 2011
I feel for the twentysomething generation. Good jobs are tough to come by, home ownership is out of reach for many (in Vancouver and Toronto, at least), skinny jeans are deemed fashionable for men, and a weekend camping now means pitching a tent...
Read MoreNovember 4, 2011
Few icons of the investment industry are celebrated outside the confines of Bay Street, but Bob Hager is one. Bob, who died on Oct. 7, was a driving force in building one of Canada’s most successful asset managers. In 1965, he and partners Art Phillips and Rudy North, started a fledgling firm called Phillips, Hager & North. By...
Read MoreNovember 1, 2011
In his letter this month, Bill Gross of Pimco talks about the cure to all our ills – growth. As he says, “No country has enough of it.” In discussing the prospects for economic growth, Mr. Gross does a good job of capturing the challenges we face. “The lack of...
Read MoreOctober 28, 2011
Oracle, which is a holding in the Equity Fund, announced a takeover bid for RightNow Technologies this week. In the past, Oracle has proven to be an effective and disciplined acquirer, but there is talk on this one that they paid too much – over 5 times sales...
Read MoreOctober 24, 2011
I came across a talk by China-based professor Michael Pettis on Paul Kedrosky’s ‘Infectious Greed’ blog. For those who are interested in China and where it’s headed, I highly recommend these 38 minutes. It’s heavy duty economics, but the points are...
Read MoreOctober 21, 2011
In the economic discourse of today, the camp that says we’re going into the tank has lots of ammunition. You don’t have to go past the front page of the newspaper to know we’ve got issues. For those arguing that we’ll be OK, or at least not have a severe...
Read MoreOctober 18, 2011
China, India and the other emerging economies will grow considerably faster than the developed world over the next ten years. That statement appears to be as close to an economic certainty as anything we can say today. Does it follow then that any...
Read MoreOctober 12, 2011
In preparing our Quarterly Report, I compiled some numbers that speak for themselves: Global stock markets had their worst quarter since Q4 2008; Greece was down 42%. Italy, France and Germany were all down 25%. Canada was down 12%. Japan was...
Read MoreOctober 7, 2011
We write a lot in this space about investor sentiment. Art Phillips, the founder of Phillips, Hager & North, taught me to pay attention to the mood of other investors. Like every tool, sentiment is not a failsafe indicator, nor is it a precise timing tool. It is, however...
Read MoreOctober 3, 2011
Dan Hallett published a piece today about mutual fund fees and how they compare to the U.S. It puts some meat on a topic that so far has been laden with hyperbole. Management expense ratios (MERs) are a lot higher in Canada, but as Dan points...
Read MoreSeptember 28, 2011
Below is an internal email from Chris Stephenson today. It wasn’t meant for public consumption (it’s an email, not a blog), but Chris is OK with me doing this. With David’s experience with the [un-named fund company] rip-off, the Globe article about $1,305...
Read MoreSeptember 22, 2011
The CBC woke me up this morning with rain warnings (Is summer really over?), big stock market declines and the voice of Finance Minister Jim Flaherty. The rain and markets didn’t get me too worked up, but I found the minister’s attempt at optimism...
Read MoreSeptember 19, 2011
The passive (indexing) vs. active management question is a polarizing debate, but it shouldn’t be. The bottom line is that both strategies have merit when they’re done right. As Morningstar USA’s President of Fund Research (Don Phillips) notes, credible...
Read MoreAugust 16, 2011
One of the richest men in the world wishes he was taxed more. Warren Buffett paid $7 million in federal taxes last year, which equated to 17% of his taxable income. Surprisingly, this was the lowest rate of any of the 20 employees in his office. In a...
Read MoreAugust 15, 2011
I came across a commentary in the Financial Times this week on the downgrade of U.S. government debt by the rating agency Standard and Poor’s. I highlight it because there’s a hate-on for the U.S. and we know all its warts. In arguing that S&P got it wrong...
Read MoreJuly 27, 2011
I was reviewing a new client’s portfolio last week and I stumbled across the Manulife Simplicity Balanced Portfolio. It’s a fund-of-funds product, meaning it holds a basket of mutual funds. In this case, the Portfolio holds 18 funds (as of December 31, 2010)...
Read MoreJuly 18, 2011
My last Globe column (Of Cash and Quality Stocks) prompted a reader to ask, “Do you believe Canadian Banks will be able to grow their dividends at a healthy clip going forward? Is the growth of the Canadian Banks over?” In the past, I've underestimated...
Read MoreJuly 14, 2011
In a post last week, Larry Swedroe wrote about one of our favourite topics – the behavioral gap. I’m referring of course to investor behavior, not child rearing or post-Stanley Cup rioting. In an investment context, the term refers to the gap in returns between mutual funds and the investors that buy them. In study after study...
Read MoreJune 28, 2011
Canadian Couch Potato posted an interesting blog yesterday. Dan Bortolotti, the author of this highly-rated blog (in a recent Globe and Mail contest, it was voted the best investing blog in Canada), thinks we need to stop fighting about which is better...
Read MoreJune 22, 2011
Fund (as in mutual) has become a dirty word. I was reminded of this the other day when Tom was lamenting over all the negative connotations associated with mutual funds. What was once a beautiful concept – investors pooling their money in a shared vision...
Read MoreJune 20, 2011
In his June 6th letter, Tim Price of PFP Wealth Management in the UK provides a thoughtful take on our debt burden. “From a narrowly financial perspective, government debt is an asset class, albeit an asset class now offering vast potential for capital...
Read MoreJune 16, 2011
