Genesis: The Beginning

In the beginning there arose an idea.

Many would consider leveraging equities as misguided in what, by all indicators, is: late in the cycle; the end of a ten year bull run; the precursor to a recession.

After months of research and deliberation, I decided to invest on my own terms regardless of these facts. Without sounding too cliche, my philosophy rests on a Socratic notion of ignorance; what I truly know is nothing.

No one can predict the future. Analysts get it wrong. Markets are irrational.

Right?… Well, sort of.

If you threw money at stocks in 2009 and held them until today, you would have done well – the bull run following the Great Recession ushered prosperity for most investors. In 2018, things changed. Uncertainty mired global growth and political stability, a sentiment that shows no signs of abating. One only take a brief glance at historical data to realize that recessions and bear markets are an integral part of the story. This is not up for debate. Markets go through cycles of boom and bust. Over the long term, however, markets trend upwards.

Again, no one can predict the future.

What we CAN do is make rational investment decisions based on a general understanding of how things work, using competent research paired to our risk tolerance. There are no guarantees. This late in the cycle, I am investing with the mindset that any stock I purchase could fall 20-40% in value (or more). At the end of the day, you need the right mindset for investing and a plan for executing buys and sells.

Here is my investment profile.

  • Long term horizon (20+ years)
  • Moderate risk tolerance
  • Diversified across sectors
  • Focus on growing dividend income with conservative capital growth
  • All dividends re-invested, with an additional 50% of net income contributed annually
  • Heavily weighted Canadian equities for tax benefits
  • 50% of my portfolio is leveraged through margin or loans. I maintain a 2-3% margin of safety between loans and dividend yield. If I am borrowing at 4%, I would require a 6-7% cumulative dividend yield
TFSARRSPCash and Margin
Blue chips
High yield dividend
Open and closed-end funds
Growth stocks
US stocks
Blue chips
High yield dividend

Check out my portfolio for a detailed look at my holdings and activity.

Socratic Disclaimer: For all this, I truly know nothing. Every investment decision I make is based on the best available data at the time. Investing is speculative by nature. Sometimes I will take greater risks and make decisions that you, the reader, vehemently disagrees with. This is the nature of my investment philosophy; play it safe, mostly. At the end of the day, no one knows how companies, the market, or life in general will play out. Countless companies have gone from boom to bust for various reasons: Enron, GE, Blackberry, Maxar… the list goes on. I am not here to tell you what to do with your money. I am here to share my experience and learning with you in hopes that you become a more knowledgeable and inspired investor. Best of luck.

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