David Larock, 40
Shares in Canadian Oil Sands Ltd., Encana Corp., Cenovus Energy Inc. and Barrick Gold Corp., plus a large cash position held in bankers' acceptances.
David Larock began investing in conservative stocks over a decade ago. In recent years, however, he put his portfolio on the back burner to focus on building up his business. That's now changing: Some big changes are coming to his portfolio.
How he invests
Investors are switching into stocks these days, but Mr. Larock is taking money out. He recently sold half his holdings and placed the proceeds into 90-day bankers' acceptances (short-term promissory notes that are guaranteed by a chartered bank and offer superior short-term yields).
"I think the world is reaching the end of a massive debt supercycle and I expect overleveraged governments to continue debasing their fiat currencies for the foreseeable future," he says. "Those chickens are bound to come home to roost eventually."
Given this inflation scenario, he is looking to invest his cash pile in companies that are backed by hard assets such as mineral reserves in the ground and substantial holdings of real properties. "Consistent with this theme, my watch list at the moment consists of more gold-related positions, recently beaten-up REITs and fertilizer stocks," adds Mr. Larock.
"When I first started investing, I bought preferred shares in Corning that paid a 10-per-cent dividend. After three years or so the company bought back the shares at double what I had paid, so it turned into a home run. I bought my first car with the proceeds."
"After finishing my MBA, I thought I was pretty clever and tried to day trade my rather modest investment portfolio. Most of my investment ideas came from listening to the talking heads on CNBC who were touting 'cheap' Internet stocks. You can probably guess how that turned out."
"Beware the talking heads on CNBC!"
"Markets can remain irrational for a lot longer than you can remain solvent."
"When all the experts and forecasts agree - something else is going to happen."
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