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Mutual Fund News


Special to The Globe and Mail




The portfolio

Shares in 35 large-cap companies diversified across 17 sectors within Canada and the United States, including Telus, Enbridge, TD, McDonald's, General Mills, Procter & Gamble and Johnson & Johnson.

The investor

After home-schooling her kids for 17 years, Faye Hamm now works part-time and focuses on investing the income she and her husband are putting aside for retirement. She spends "two to four hours a day reading up about stocks and portfolio strategy."

How she invests

"My main strategy is to build a growing dividend stream so that we can retire and live off the dividends without spending the principal. With a modest lifestyle, a strong savings plan and a time horizon of 20 years, it really is possible for us."

She likes companies with large capitalizations because they usually come with less risk of insolvency. Of this group, she prefers those that have histories of raising dividends annually.

Also, the "dividend growth is higher than inflation so that in retirement our income will increase faster than our expenses."

"I tend to be bold buying on the dips," adds Ms. Hamm. For example, Ross Stores Inc., a U.S. clothing chain, was purchased in July when the "share price was unduly punished by an analyst downgrade."

Best move

"The first time I experienced the power of buying quality companies on a dip was Ford Motor at $9.14 in August, 2011. It has done nicely and is now supported by a modest dividend."

Worst move

"Without question, Royal Bank is my biggest investing regret. As a newer investor, I bought in September, 2011, and sold when it reached my mental stop [loss order], consistent with my trading strategy at the time. The next day it recovered sharply and began a long ascent."


"Investing for me is an integral part of household management, and self-directed investing has completely changed our retirement possibilities. It has moulded me to be a much better steward of the resources we have."

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