A simple book that's easy to digest, while having my morning coffee.

Some of my favorite lessons:

Make your contribution greater than your applause
Make your learning greater than your experience

Thanks to my Brother In Law for giving me this little gem for Christmas.

Details and results omitted from this forum.

..forgot to journalize my ideas gleaned from this fascinating couple. They are in their 60s, healthy, wealthy, and wise. The husband is a part-time Rabbi and as such he gets to cruise for free, along with his wife, provided he serves at the ship's chapel for services, which was during Hanukah.

As we were waiting for our embarkation, both he and his wife noticed how active and joyful my daughter was. After some introduction, I learned that he had a business, and that he has 3 homes in New York NY, Boca Raton FL and one other location. The two of them spend their retirement years cruising, visiting their children and grand children, and collecting art.

Their investments are mainly equities. They reasoned that it is better to own pieces of great businesses, which already employ great employees, generating great profits, than to run your own business.

It made me think about the path I have chosen for myself: to invest in great companies with enduring competitive advantages, with great managements, and a track record of profits, returns on invested capital, and all the attractive elements that draw the great investors - Graham, Buffett, et al.

It also made me think about the life I want for my wife and I after our children are grown.

This time, a two person team, averaged over $100 per hour per person.

..for the end of the office rental in Dec 2009. Only $46, but a nice surprise, and I put it into the Company bank account. Now if I can do something about the pesky $6 per month bank account fee...

..again this year, using money saved every month in two ordinary savings accounts. Feels good to max out on this great provision of tax free asset building!

The next step is to carefully select the proper investment inside the TFSA again this year.

I'm thinking to double down on XIU which has been mildly profitable in my TFSA for 2009.

Alternatively, I may select an individual stock whose growth potential is strong.

One of the biggest disappointments in our investments have been Mutual Funds in our RRSPs that have lagged the market going down, and going up. So I called my wife's broker to sell all the mutual funds.

I first asked what were the various fee types. He explained No Load, Deferred Load, and Level Load. It turns out that he selected in every case a Load type fund, rather than No Load. His rationale was that not all mutual fund companies sell No Load products. In my mind, I was thinking "what value do these Load Type mutual funds offer above No Load Funds? And to rub salt in the wounded investor, they take an average 2% to get out of the fund, as a parting shot"


I then asked about the Labour Sponsored Fund that we bought in her account, to determine if we can sell it without clawback of the tax credits received when the LSF was purchased. Subject to being tax free, I asked that it also be sold.

I then asked that he sell the units of the super-underachiever, Faircourt Asset Management's Income and Growth Split Trust. This dog lost 75% of its value, and its existing warrants to buy units at $4 will keep the price down until they expire mid 2010.

I am glad that I no longer own: AGF, Acuity, Fidelity Moochual funds. Why do I call them this? Because THEY MOOCH YOU.

The last support line, the 200 day moving average, was crossed on Tuesday Jan 26. After breaking through the diagonal channel line, and seeing the 14 day and 50 day MA's were already broken, I decided to sell all index positions and get back into cash. The contrary signals to stay in were a deep buy signal from the stochastics and the MACD histogram.

I will get back in if the index reaches the mid point of the bollinger band and the stochastics and MACD go back up.

Loss was -4% or less depending on the fund. Don't want losses any deeper.

Uhm... you know technical analysis is voodoo nonsense, right?

If a "system" really, truly worked, everyone would use it, at which point it would no longer work, because everyone is using it.

The only thing you can control are you expenses. Selling at the bottom and buying at the top is a recipe for financial failure.

Hi, Kombat:

Thanks for your response.
Buy high sell low is bad, and I agree with you. But holding on to your losers is even worse. And if I made a mistake in buying, I sell to cut my losses.

I respect technicals, price trends, and use them as trading tools to assist my value-based approach (which is in development). I think index funds is no longer going to be part of my portfolio, I would rather pick specific companies from now on.

As far as the "if it works, everybody would be doing it" argument, I used to believe it, but I no longer do. I believe few people are willing to do the hard work to make easy money.

I called to explain why we were moving out of the full service broker.

One of the awful surprises that came out of my previous instructions to my Wife's former full service broker was the hefty commission for a straight sale trade of publicly traded income trust units.

$130 fee for the trade!! That is unbelievable! And according to the broker, that was the lowest he could go! Well, I am grateful those days are over. From now on, all trading in the family portfolios will be executed for less than ten bucks at my preferred online discount broker.

The last 3 housekeeping items included:
- end date for the last Labor Sponsored Venture Capital Fund (Feb 28, 2011) purchased in Feb 2003. This has not yet been transferred.

- confirmation that the January 2010 regular and special dividends from Just Energy (JE.UN) was captured in the transfer - I should follow up on this to be sure, by reading the next statement.

- the US dollar investment account will be cashed out, converted to Canadian dollars.

I ended with the point that for many months my Wife's account had idle cash that was not earning any interest. I had to call to ask for an alternative and found an interest bearing account with no fees. This should have been proactively recommended without my having to ask, else why have Full Service?

I will be the family Financial Advisor from now on, because I care more about my family's finances than any professional out there.

..this has been a new quest for me. So far I have the following:


DUNDEE INVESTMENT SAVINGS ACCO 05-Feb-2010
DYN500 N Y CDN 10.00 0.00 (0.00%) 0.65%

MANULIFE BANK INVESTMENT SAVIN 05-Feb-2010
MIP510 N Y CDN 1.00 0.00 (0.00%) 0.7%

ALTAMIRA CASH PERFORMER 04-Oct-2002
AIS100 N Y CDN 1.00 0.00 (0.00%) 2.5%

RBC CANADIAN MONEY MARKET 05-Feb-2010
RBF271 N Y CDN 10.00 0.00 (0.00%) 0.0921%

ALTAMIRA HIGH-INTEREST CASHPER 05-Feb-2010
NBC100 N Y CDN 1.00 0.00 (0.00%) 0.55%

The best seems to Manulife Bank at 0.7% if the Altamira is no longer available (quote was from 2002 which was strange).

This company makes and licenses software to hundreds of mining companies to model their reservoirs.

Meaning: My wife understands the software business.

Management: Company Management owns a good chunk of this business (16%).

Moat: Once a company starts using CMG's software, it pays licenses to continue to model its supply and switching would be expensive and tedious.

Financially, it has 10 years of:

Equity Growth: 21% p.a.

EPS Growth: 0% first 2 years to 115% recently

Sales Growth: 18% to 56% recently

Free Cash Flow Growth: 42% to 122%

ROIC: 45% (5 years) to 68% (1 year)

LT Debt: none

Dividend Yield: 4.5% paid quarterly


Valuation:
Current EPS: 0.91

Future EPS Growth Rate: 21.74% (same as equity growth rate)

Future EPS: $6.51 (10 years hence)

Future PE ratio: 43.48 (10 years hence at double the equity growth rate)

Future Price per Share: $174.32 (10 years hence)

Sticker Price (10 years 15% cagr): $43.09

Margin of Safety Price: $21.54

Current Price: About $16 (cheap!)

Trading Decision:
Average trading volume is very low, about 17k shares.

Yesterday on double daily volume the price broke above prior resistance. I bought 500 shares at market end of day for my Wife's TFSA at $15.95 per share.

Target: Sticker price $43.09
Stop loss: $15 support (watch) $14 support (if breaks, exit)

This has been in and out of my portfolio since last year. The reasons I like this company:

Meaning: I like the simplicity of this business. It transfers coal from trains onto ships.

Management: The management runs a tight operation. Sales and profits per employee are huge. Dividend yield 9%

Moat: The company can deliver 30 million tonnes of coal per year, up 10 million from prior year. Its competitor, Neptune Terminals, can handle 7 million tonnes. Its customers include Teck (TCK.B) which is 70% of Westshore's revenues.

The contract with Teck will expire in March 2010 and is under negotiation. In my humble opinion, now is a good time to buy because:

1. Loading Volumes are up in Jan and Feb 2010, thanks to the new capital equipment investment to expand capacity.
2. Teck is committed to increase Metallurgical Coal production in 2010
3. China will continue to consume met. coal for steel production in 2010, as well as south Korea, and Japan.
4. Teck already owns Neptune Terminals but this is not sufficient to meet the volumes Teck wants to deliver overseas (about 35 million tonnes)
5. Teck said it is NOT interested in further investments, after its costly acquisition of Fording Coal Trust in 2008. Rather, it wants to reduce its existing long term debt. However, controlling the pricing of coal loading at Westshore would best be handled by a controlling interest in Westshore BEFORE the contract is renewed, to exact influence. And it would not admit to any planned acquisition until finalized, to keep target share prices low. Market value of Westshore is a billion dollars.
6. BHP Billiton is committing its coal supply to China, as well as experiencing high demand of iron ore from China.
7. Coal prices will be set on a short term basis, rather than on a coal year basis, to capture anticipated higher 2010 coal prices vs 2009.


So I added 500 units at market late yesterday Feb 10 at $14.35

Support: $13.60 (if breaks, sell on stop below $13.50)

Wouldn't higher coal prices be a bad thing for this company? Westshore doesn't sell coal, it just moves it. So, if prices go up, doesn't it logically follow that consumers will buy less of it? Doesn't that spell decreased revenues for companies like Westshore, whose business is built on moving coal?