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Mutual Fund News


Special to The Globe and Mail

Ivar Liepins, 84


Retired portfolio manager and manager of investment research.

The portfolio

Mainly dividend, resource and gold stocks.

The investor

Ivar Liepins is enjoying a comfortable retirement. While working, he "always contributed the maximum allowable amount to his registered retirement saving plan." And since retiring, his registered retirement income fund has more than doubled in value, net of withdrawals.

How he invests

Prior to retirement, Mr. Liepins took large investment positions in special situations.

"Now, my investments are diversified among industries and companies, mostly Canadian as the dividend tax credit offers an advantage in a non-registered account," he says.

"As a retired person who requires investment income, I feel safer with dividend-paying equities, preferably of companies with well-established performance records and solid market positions in their industries." Some gold equities provide diversification.

"At present, several industry groups are out of favour, including mining and energy companies. With economic recovery and unstoppable worldwide population growth, they are bound to recover at some point. I have positions in several natural resource stocks."

To collect more income, Mr. Liepins sells call options against his holdings. He selects call options that will yield double-digit returns (annualized) if exercised.

If they are not exercised before their expiry date, he will sell more call options to generate additional income.

Best move

"Purchasing several oil and pipeline companies a number of years ago.

"Several have been paying excellent dividends while more than doubling in price."

Worst move

"Holding onto Nortel."


"Adjust your risk exposure to your risk tolerance. Diversify, and preferably own some real estate in addition to financial investments.

"Increase exposure to attractive U.S. blue-chip dividend payers to hedge against a further decline in the Canadian dollar.

"Never invest heavily in shares of companies whose business you don't understand."

Want to share your strategies?


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