All The Money in the World

I watched the movie with Christopher Plummer in the lead role of American Businessman J. Paul Getty last night.

What a trip.

Getty amassed his fortune in the oil business during the depression. The movie was based on true events about the kidnapping of his grandson in Italy during the 70's.

The grandson J Paul Getty III died in 2011 at 54 yrs. old due to complications from a drug overdose earlier that left him a quadripalegic.

He became as fucked up as his father with his drug use while his father lived until 70 yrs old after cleaning up his life.

The movie is aptly titled because all the money in the world could not save this family from the disease of drug abuse and ealy death.

Starting with the old man who became just a Scrooge type miser in the end. It was all about the money in life and in the end while accumulating huge wealth died alone holding a painting.

The family is always struggling with the curse of making bad life decisions and early death and tragedy.

Getty sold his oil interests to Texaco for $10B and at his death the family trust went into the hands of his grandson's mother Abigail Getty Harris.

It is now worth $2B and in the hands of Gordon Getty the 4th oldest child. (Google the family for more info). He has his own problems of course but he has so far lived to be 81 years old. 

While the movie was based on the kidnapping of Junior III you can come away with some money and life lessons given out by Getty during the course of his crazy elderly years.

"Anyone can get rich but being rich takes work"

OK. he says being rich you have to work at living like a rich person and falling into the abyss. Getty says you have to learn this when without money nobody cares about you.

I dunno,  think for most it is pretty hard to get rich so they never get to learn how to BE rich. I think for most they would like to try anyway.

The guy was an art nut. Enough to start a museum in New York bearing his name. He believed in buying tangible assets that remained constant. People change but material possessions stayed the same. He liked thatabout things. He had a lot of stuff.

"If you can count your money, you don't have a billion dollars"

It's an arrogant I'm rich AF statement. He owned estates in England and California. He had billions but still died alone was cheap as fuck. He even had pay phones installed on site so guests or family members had to pay for any long distance phone calls.

My Final Lesson Learned

All the money in the world doesn't mean happiness, love, family or exempt from early death, drug abuse and tragedy.

This family just abused themselves with drugs and women. They had nothing meaningful to do with their lives it seems. I guess when you are a trust fund baby like Paul the third, life is just meant to be fucked up. I can't imagine his mother who worked tirelessly on his kidnapping to live long enough to see him overdose and become tied to a wheelchair. So f'n sad and what a waste of a fucken life!

People who have everything really have nothing. The Gettys were and are rich AF but man they have and have had big problems. Just like poor people.

The old cliche holds true, that all the money in the world won't save your kids or buy you all the happiness in the world.

We all have to find our happy, that's all that matters. The Getty family was far from happy. I hope this new generation can find some.

Having said that, I have no sympathy for people who still abuse drugs and their entitled lives. Pfft!

How to Keep It Simple Stupid

I'm talking about the principle of keeping it simple stupid as it pertains to investing. I just read a blog post from Ryan Lewenza over at Turner Finacial on his definition of KISS and this is my counter argument on the points he has made on the subject.

First of all the whole argument can be summed up in whether you believe in modern portfoio theory (MPT) or you don't. I don't and don't really give a fuck about it. I don't buy bonds, preferred shares, mutual funds or their ugly step sister ETFs. It's just me.

If you are a professional money manager and you are charging fees to hold a client's hand then you need talking points to justify why you do the things you do. Song in there I think. Anyways. This is where you follow MPT, buy ETFs and always mutter on about KISS.

It's like that's the only strategy out there. NO it's not but highly effective keeping the herd in line when they start to want to stray. I've been straying and following different paths before I settled on my path.

I DIY my own portfolios, I don't pay fees and I just buy common dividend paying equities. Does it get any more KISS than that? The hard part and it really is hard is holding on and letting it work it's magic.

Of course you can pay someone to do this for you. They call it 

'The Balanced Portfoio'

Here is my take on the points presented.

Balance

You need bonds in your portfolio on those days when your stocks are going down. Why would anyone with a small semblance of brain cells invest in 10 year government bonds paying 1.5% interest? Those seeking balance and poor returns is who?

It's just razzle dazzle in my opinion. I don't invest in them or any bond proxy funds and ETFs for simplicity and or convenience. You are left paying fees to the fund manger and fees to hold the fund or ETFs. Balance at Turner Financial usually means 40% allocated to a mix of bonds/preferred shares giving you a 3.5% yield on your fixed income side.

I don't want at anytime my income to be fixed. I want a growing income that I believe is better gained through a portfolio of dividend growth stocks. Better in retirement and better to combat the ravages of inflation as you age and shit get more expensive and we all get more unstable. 

Balance is all part of the twaddle referred to as MPT. It's just not necessary for you to hold bonds or pref shares and pay ongoing fees that slowly eat away at your money.

Don't know how to manage your money. Go fucken learn. Libraries are full of people seeking knowledge. Yes, you can do this and it's fun keeping more of what you earn and save.

Why pay someone to lose your money for you. You will ask yourself that when the next recession hits. Just sit tight and enjoy the stocks you bought and do nothing. That's all your money manager will do when you go asking questions.

Diversification

This is the idea that you need to hold 40% of your money split between preferred shares and bonds of all types including, federal, provincial, real return etc. etc.

I don't hold any of those types of products. It also preaches to spread your money out throughout the world to reduce risk.

Of course I don't do this and also you have to believe in Modern Portfolio theory which I don't.

Asset Allocation

Hold different asset classes depending on your age, income and how many years you are away from retirement. I only hold Canadian DG stocks.

I'm doing just fine. I will live on the juice those dividends provide. To me, it doesn't matter what age you are just BUY STOCKS!

Hold them forever and only sell unless you have made a mistake.

In Sum

Just be careful who you take advice from and how they get paid.

In this case you pay an ongoing management fee + ETF fees. They will eat into your returns over time.

Some love this model of letting others do this for them. I am not a fan and would rather be a DIY investor and if I lose money then I'm not paying others to do it for me.

You can do this on your own. If you don't know how, then go to the library, pick up a book and learn. Now that's how you KISS!

How do you keep investing simple?
How do you define

CI Financial and Why I Bought This Stock

You bought a wealth management company that sells mutual funds that you hate and abhorr?

Right?

So, why CIX.TO?

It's pretty beaten up, still making money and compounding income at a great clip so far. 

After the financial crisis they cut the dividend 50% from 10 cents down to 5 cents. This was not unusual for a lot of companies at the time.

Since then they've slow and steadily raised that dividend to now 18.5 cents a quarter.

Let's look at some of the numbers;

High Stock Price - $35.05
Now - $21.77
Price Paid (200 shares) - $20.47
P/E - 9.17
ROE - 36%
Yield 3.3%
Payout Ratio - 43%
FCF - $625M

Revenue and Earnings growth continue to move up.

The fact is as much as I would never own a mutual fund, many people still do.
Don't buy the fund, buy the company.

The stock is still way off it's all time high and for me is considered a low yielder. If you are looking for something different that has been beaten up and may provide significant potential to grow revenue and thereby give you some capital appreciation, this is one that I decided is worth that punt.

I bought it for my RRSP.

It has really taken a hit in the last 5 years and investors have thrown it away and have gotten frustrated with it. That's why I believe it's cheap. I also believe most of the risk here is to the upside.

I love stocks that have raised their dividends for 10 years and are still trading at a single digit price to earnings ratio.

From Yahoo:

CI Financial Corp. is a publicly owned asset management holding company. Through its subsidiaries, the firm manages separate client focused equity, fixed income, and alternative investments portfolios. It also manages mutual funds, hedge funds, and fund of funds for its clients through its subsidiaries. The firm was founded in 1965 and is based in Toronto, Canada with additional offices in Vancouver, Canada; Calgary, Canada; and Montreal, Canada.

My Final Take

I'm hoping to juice my returns a little bit with a stock that is rising off it's 1 year bottom of $17. It has recovered nicely. In the meantime I will collect the dividends and be patient. If it recovers to $30 or higher I'll be a happy camper.

This is just what I have done and not a recommendation for you to buy this stock. Do your own analysis and research before making any buying decision. 

Would you buy CIX? What other financial wealth management companies do you own?

Your Ever Growing Income - My Book Review

TITLE: Your Ever Growing Income
AUTHOR NAME: Henry Mah
AUTHOR CREDENTIALS: Certified Management Accountant, Canadian Investor
GENRE: Personal Investment Strategies
NUMBER OF PAGES: 151
PUBLICATION DATE: January 2019

SYNOPSIS/SUMMARY: This book will provide you with a method of stock evaluation that identifies quality income growth stocks and show you how to build an investment portfolio that will provide you with a steady and ever growing income.. 

It is only appropriate when you have a website on 'Strategies to Grow Money' that I have a chance to review a book by Canadian investor Henry Mah.

This is a nice short read of 151 pages and 6 chapters. Henry also includes some Excel work sheets, a list of discount brokers and recommended books and websites to read.

Chapter One

Breaking away from the norm and income is the answer.

In this first chapter Henry lays out a plan for you to;

• beat the slight of hand of market timing
• eliminate guessing of how to pick stocks
• a simple effective way to identify stocks
• an alternative to market returns
• a system where your returns are not tied to market fluctuations

Henry also follows Tom Connolly who wrote the foreword to his book and runs the site dividendgrowth.ca published bi-monthly for a small fee. Tom has been investing this way since 1981. Put simply this is how he buys stocks.

"If a company does not pay a dividend, don’t buy it. If it doesn’t grow the dividend don’t buy it either.”

You can't get any simpler than that when looking for what stocks to buy. The goal is to find a few stocks that will provide you with a growing income from your investments.

The big take away here is the focus on income growth and NOT the day to day swings in the stock price. Ignore that and focus on what the stock provides you in income. Of course, the more you invest and the cheaper price you pay will definitely impact your long term return.

Chapter Two

In this short chapter the focus is on generating savings to invest and how to offset the ravages of inflation. This is about generating income for retirement and not about saving for luxuries.

The worst thing to happen to you in retirement is to run out of money. You must invest in a way so that as your expenses rise they can be offset with a strategy to grow your income. The first step is to SAVE and then invest for INCOME.

Inflation goes up every year so we need to match that with an income stream that also goes up.

Chapter Three

The focus here is developing an investment strategy suitable for you. 

Henry also covers the hazards of ETF investing which I have constantly railed against on my own blog. They just contain too many bad stocks and businesses you would never invest in on your own. I don't own any but if you just want a market return then go ahead.

Income investing means focusing just a few investments in quality companies and NOT on total market return.

ETFs are expensive to own and also cost more, the more you have invested. They are also getting more complex all the time and the landscape is bulging with options to choose from. They are becoming more and more complicated every month.

The Four Guiding Rules

You will have to buy the book to see what is presented exactly as a strategy but suffice to say it depends on dividends, how long they have been paid and whether the company has cut a dividend. Is the company consistent paying that dividend and has the dividend grown?

Studying just these rules of DG stock analysis and questions, is worth the price of this book.

For stock analysis Henry provides a link to Morningstar where you can analyze all stock components of the TSX 60. This is how you will compile a list and where you will get all the pertinent information on the company. I use it when I have more cash to invest and choose the right company for my money.

A process is illustrated in this chapter RATHER than a recommend stock buy list for you. You apply the 4 rules to each stock and then determine if it's suitable for purchase. Rather than coming up with guesswork this process will eliminate stocks and also compile a BUY list for you.

I must do this for myself instead of just relying on the list that Tom Connolly provides on his site. This way the list is yours and gives you a great sense of how successful the process is by applying the 4 rules.

UPDATE: Since writing this review, Morningstar only provides this service for subscribers (still worth it).

Chapter Four

Topics covered include;

• where to invest your money
• how many stocks to hold
• when to sell (if ever? I try not to)
• recording your investments

Lastly, Henry goes into how 'you need to forget all you've heard and followed about the basic rules of investing'.

Chapter Five

Why should change your investing course now and follow your own path.

Chapter Six

Relevant proof is provided with income data and how Henry is meeting his income needs.

My Take

Everyone should have an investing strategy. The point is to have one. Buying lottery tickets IS a strategy, just not a very smart one.

Is this book the only one - Ummm NO!

I am a student of Tom Connolly's DG strategy as I've mentioned many times on this blog. As a retiree I use it for income ideas and overall motivation. Mostly I just let my concentrated DG portfolio sit, stew and do it's work.

For Growth stock strategies I follow Robin Speziale and his Capital Compounders and love to listen to Barry Schwarz and what he recommends.

You have to do what you think is best and be comfortable doing it. I love being a Dividend Growth stock investor. Why? I think it's fun and I love seeing those dividends automatically deposited into the accounts. From there I make buying decisions based on the criteria Henry teaches in his new book.

I don't use Modern Portfolio Theory and it's adherence to asset allocation, balance and diversification. I don't believe in it and neither does Henry, Tom or Robin.

You simply buy big stable dividend growing companies that pay a consistent and rising dividend. It is suggested to focus on companies that have a record of doing that for at least 10 years.

In his book Henry DOES NOT give you specific stock recommendations or any sample portfolios. This is also what Tom Connolly does not do. Henry instead provides you with a screening and evaluation process to determine what stocks you should or shouldn't buy. This way you learn how to do it your way.

Be Like Henry 

I try to be. I don't own any funds, ETFs, bonds or preferred shares. I only own Canadian DG stocks - banks, pipelines, utilities, railroads and telcos. I also own Costco. I just couldn't resist and hated all the Canadian grocers and their low yields. Most are very expensive compared to Costco. I shop there, so I wanted to be an owner. I only purchased it last September and am already up 20%.

Other than Costco it's just those areas I'm interested in. 

NO gold and NO weed! 

Most PFs are constructed whether by professionals or ETF marketers with a 60/40 split. 60% equities - Canada, U.S. and Int'l and 40% bonds and pref shares.

I hate to pay fees. As Henry says it's still a fee and it acts like a leaky faucet in your portfolio. Those small fees add up over a lifetime of investing. Just build your own portfolio of quality companies.

Henry's Words of Investing Wisdom 

• forget diversification, it's just investing jargon and propaganda to get you to buy funds or ETFs
• quality over quantity (Henry owns just 12 stocks)
• a few great stocks are a lot better than a bunch of lousy ones
• don't chase yield

In Sum

We've all made mistakes and have made some bad buying decisions. If you use the tools Henry provides in his new book, your chances of long term investing success will greatly improve.

This is a great little book written by a Canadian for Canadians and I have no trouble at all recommending it to all investors no matter where you are on your investing journey.

Leave it Alone and it Will Grow

Most investors think that the more they play with their portfolio the more it will grow. I can tell you from someone who loves to frig around with that kind of stuff, it doesn't.

Your best results come when doing nothing. That's right nothing. Just leave it alone to work it's magic. Try not to fall for the day trading stuff and jumping in and out of the top picks you hear all the time.

Why sell your bank, utility, telecomm and pipeline stocks? Maybe the only reason is you need the money and that would be too bad as you probably have more problems than money.

I can see no other reason for liquidating a growing portfolio of dividend growth stocks.

With all the volatility in today's investing environment the best course of action is doing nothing.

The best time to buy any stock is when you have the money. Never try and time anything or beat yourself up about buying at the right time. Nobody knows anything about that. Buy when you have the money. It's as simple as that.

It might not be the right time to buy bank stocks but why would you sell your Canadian bank stocks. Just keep building them up.

I bought more TD, RY and BNS on Friday. I did sell my TFII to generate a higher dividend through the bank stocks.

I also had a position in US Steel (recent purchase) and I again sold it due to the trade war and underperformance. The only US stocks I own now are Costco and Amazon.

I'm done buying anything until Novemeber when everyone else is selling. I'll use whatever funds are in the account from generating dividends until then.

I feel more comfrortable holding more bank shares as they are under a short attack (apparently) and that is news you just shouldn't act on.

Waren Buffett calls it "benign neglect"'. That is the strategy to embrace to be a successful long term investor.

Just leave it alone and it will grow on it's own. Unlike other things in life that require more of yur attention. Now go hug your significant other.

Jason Del Vicario on Growth Stocks - Part II

Just a short post on what stock picks were mentioned by JDV on Market Call Tonight on May 2, 2019.

My favourite market expert on growth stocks. Others include Barry Schwarz and Jason Donville.

Stocks to Buy

SYZ, GC, STC, PKI, ATD.B, WEED (weak buy), STN,

Don't Buy

Teck Resources, North American Palladium

Watching

Aritzia

Manulife

Cisco

Top Picks

Right Move

Constellation Software

CI Financial

JDV is one of my favourite Market Call guests on Growth Stock investing.Probably one of my worst investing regrets was selling CSU too early. It just recently hit a new 52 week high.

I did just recently buy CIX which I don't normally do when hearing about a stock but I did some research of my own and initiated a small toe tester position.

CIX is an asset management company and it's been on quite the tear since the new year. It yields 3.7%, has a low p/e of 8.7 and a ROE of 36%.

As a retiree trying to build a portfolio of growth and income stocks this company for now ticks a lot of boxes. It remains to be seen whether it can continue to grow or it might be a candidate for a buyout like Gluskin Sheff.

The other stock mentioned on this show and that has great metrics is Parkland Fuel. I don't own it yet but I love the gas station/convenience store business. For those of us that missed Couche-Tard this is a great alternative with a lot of US exposure. It's an easy business to understand if you can resist the temptation to just leave it alone and not sell it.

I have no idea what the portfolio minimum you need to invest with Hollis Wealth and JDV but it might be worth your while if you want to grow your money with a very knowledgeable and likeable investment manager. 

I don't watch BNN Bloomberg every day (life is too short) but I do get alerts and when Jason is on I set a reminder. You would be well served to do the same.

Great show and thanks for the tips JDV!

Bruce Murray on North American Growth Stocks

Just a short post on what Portfolio Manager Bruce Murray had to say on BNN Bloomberg on NA Growth Stocks.

I like to have a mix of income (mostly) and growth stocks in my portfolio. I believe in investing in good businesses that you understand and have the potential to grow their earnings over time and return that money back to shareholders through dividends and capital appreciation.

Many experts come on BNN giving out top picks and investing ideas mostly for entertainment and promoting their firms. Every once in awhile you hear about good companies worthy of further explanation.

Have you heard of The Murray Wealth Group? Me NOPE!

Everyone is consumed by the US/China trade war and it's the latest reason/excuse from most portfolio managers. It helps when your clients come calling when they think the sky is falling. It's when guys like Bruce come in to hold your hand during these times. After all that's what he ges paid to do.

He likes India to invest in through global companies.

Stock Questions

Visa V - good 3-5 year hold, doesn't own it. Owns Mastercard. Buy Visa now

Medical Facilities DR - has traded it sold over $17. Closed at $12.50. Just had a bad quarter. High Debt. Has lost 30% over the last 5 years. Owns a 2-3% position. Looking to add in a couple months.

Keyera KEY - good company, struggles with the oil price. Hold for the dividend

Bristol Meyers - taking out Celgene at a premium. Next 12 months it will struggle digesting the transaction. Sold his Celgene today.

Pfizer - sold it at $43 recently. Buy it sub $40.

Owns Astra Zeneca and Lily in the HC sector.

Very choppy speaker when giving answers to caller questions. He sounds nervous AF. Already I don't think I would let this guy handle my money. Then again that's probably not fair as I would not let anyone do that anymore.

That's why these shows actually suck and that same annoying caller is always asking questions.

TFI Internatinal TFII - trucking co. great management. (I own it) Up 82% in the last 5 years. Fuel pices can be a drag on the share price as with all delivery companies. 3% dividend.

United Technologies UTX - aerospace, will spin off its elevator business. 

Morneau Shepell MS - benefits and pension plans, expanding into the States. Steady slow growth, high quality investment. Solid growth company.

Sierra Wireless SW - makes stuff for the internet of things. Sensors etc... doesn't own it but could buy it. Need to hold it for 3 years. Hs lost 30% in the last 3 years.

Past Picks

Broadcom up 23%

chip manufacturer being hit by the Huawei troubles. Still holds it

BMW down 22%

still hoding a 2% position. If it drops he buys more. Will be a big player in electric. Tardes at 5X earnings.

Air Canada up 79%

Has gone bankrupt twice in it's history. AC will become a victim of the 737 Max probs.

More Calls

I'm just going to list the remaing stocks he took calls on. I can't keep up with or understand half of what he is trying to say.

Walt Disney DIS - he missed it

New Flyer NFI - doesn't own it, looks attractive to him

Becton Dickinson - solid HC company. Buy it and hold it, maybe wait for the election.

Enbridge ENB - we need pipelines (I own it) lots of debt great dividend. He owns it. Decent play not a lot of risk. 

Tapestry TPR - bought Coach and Kate Spade brands. He bought the stock a couple months ago and is down a few bucks. 3-5% dividend.

Amgen/Allergan - doesn't own them but would buy Amgen of the two

FedEx FDX - impacted by the China war. European problems. He is doing more homework but likes it here. Everything is going wrong. He's waiting to buy but could be wrong as it could drop another $25 (oh brother great advice).

Blackstone BX - owns it, likes the dividend

Marvell Tech Group MRVL

CIBC CM - TD is the best. Overplayed the mortgage business. Impressed by management. Best divy of the group.

Top Picks

Microsoft MSFT

UnitedHealth UNH

Linamar LNR

My Opinion

The only stocks I liked that were talked about were Visa, Microsoft and Disney. I think they are great 10 year holds at current prices. They are definitely worthy of more research on your part. They are definitely on my buy list.

I used to own Linamar and thought the stock would  really take off after we had a new NA free trade agreement. Apparently that was a lie too. Nobody knows shit and another reason why you can't buy stocks on the recommendation of experts on TV. Bruce bought LNR at 0.70 in 1976. The stock has been as high as $80. Now at $43. Maybe it's time to put it on my watchlist. Electric cars and components are the future of driving. Invest accordingly if you are into growth stocks.

To me Bruce Murray was a very frustrating guest to listen to. I do respect his time in the investment industry and his longevity as an asset manager. He has to be doing something right. He's a Ross Healy type of character. Lots of hawing and himming at times. Not everyone can speak and answer investor questions with rhythm and thoughtful insight.

He never once stated his firms philosophy or strategies to grow money. I have no idea how he selects stocks or what he looks at before making buy/sell decisions.

I own TFII, ENB, CM and TD of the stocks mentioned on the show.