Benj Gallander spoke in a Saturday morning session for Canadian Money Saver on "Simple Changes People Can Make to Improve Investment Returns". Benj Gallander is the President of Contra the Heard. Their site is www.contratheheard.com. I went because Canadian Money Saver sessions have given good talks in past Money Shows. Their site is www.canadianmoneysaver.ca.
The most interesting thing he said was they companies that have no debt have a hard time going bankrupt. He also mentioned that they have commentaries on their site.
Benj Gallander says he is a value guy. He says you can get better returns by turning off the noise. Cut the noise. Too many people react to it. Do not pay too much attention to your returns. Warren Buffett says that you should be greedy when others are fearful and fearful when others are greedy.
He says that rarely no more than 3 or 4 variables count in picking stocks. The rest is noise. No one cares more about your money than you do. Active investors do worse than passive investors. Active investors pay more fees.
Stay away from actively managed mutual funds. They have higher fees. Go to Mutual Funds that have lower fees. ETFs are even better.
Most people can manage their own money, even though a lot of people say differently. You should invest yourself and save. Benjamin Franklin said that the investment in knowledge is the best investment. Investing in your career is the best thing you can do.
John Temple said that the phrase "This time it is different" is the worst saying ever.
Bitcoin and crypto-currencies are really hot and the next big thing. You can make money on them, but you can also lose lots. What is big at this show is pot. When investing look to see who is in management. What have they done before? Some pot company managers previously ran mining companies that never went anywhere.
Improve you investment returns by saving money and buy things when they are cheap. You have to be patient. Try to control your emotions. Charles Munk (Warren Buffett's partner) said that you should identify stocks that you want to buy and then wait and get to know the stocks.
Walking is one of the best ways of thinking up new ideas. It is good to fine a few good things to do. However, realize that we cannot know everything.
Do not invest in IPO's. Most IPO's do not do well. However, sometimes with IPO's you can get lucky and make lots of money.
He likes companies that have been around at least 10 years. Diversification is good, but do not over do this. The rear view mirror is great for understanding, but you need to look to the future. The stock market is filled with people who know the price but not the value of anything.
It would be good if the Canadian tax system had reduced complexity. However, you can use it. You can use RRSPs, RESPs and TFSAs. Gain a certain amount of knowledge about these and use them. The RESPs are good as you put money into them and the government will also give you money. They can be a good deal.
He does not buy on margin. If you have credit card debt, the best return you can get is to pay of this debt.
Active traders use Quest Trade. The day traders do not make money, but Quest Trade does. It was harder to make money in the past because of investing fees. Now fees are cheap and most trades are for $9.99.
He does not believe that the market is perfectly efficient. You can make money by buying a company that is a take-over target. If the deal falls off the table, often the company still gets taken over later.
You have to have discipline. Without discipline you have no method. When he buys a stock he sets a sell price. They mostly stick to it but sometimes they can change it.
You should buy near the end of the year and take advantage of the Santa Claus rally. Often stocks go up after they sell them and sometimes they go down after they buy them. However, this is life.
After 9/11 airlines companies were decimated. They were so tough that people thought KLM would not make it. However, the company thought they would recover and they did. This is short term thinking against long term thinking.
They bought an US insurance company that had problems. They thought they would raise rates and do better later. At this time they have done less than nothing, but they still have the company. The company has no debt. Companies with no debt have a hard time going bankrupt. They will hold on to companies that have no debt. This might look stupid in the short term, but in the long term they can make money.
He thinks that climate change should influence your investment decisions. There are good and bad things about climate change. A possible good thing is that you can grow food in places that we could not before. However, on balance climate change is bad.
He thinks that marijuana should be legalized. However, this is going to cause problems.
He said that Trudeau's father was bad at economics. So is the son. We are heavy into debt and this makes no sense. Ontario liberals have huge problem with debt. It is causing them to sell off their crown jewels.
On my other blog I wrote yesterday about North West Company (TSX-NWC, OTC-NWTUF)... learn more. Next, I will write about Pason Systems Inc. (TSX-PSI, OTC-PSYTF)... learn more on Wednesday, November 1, 2017 around 5 pm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
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