Market masters : proven investing strategies you can apply : interviews with Canada's top investors

660 Pages·2016·2.38 MB·English

by  Roseman

PROVEN INVESTING STRATEGIES YOU CAN APPLY
INTERVIEWS WITH
CANADA’S TOP INVESTORS
ROBIN R. SPEZIALE
Praise from Around the World for Market Masters
“The words of wisdom from the Market Masters are priceless. They offer
guiding principles and lessons for anyone who is interested in the stock market.
Whether you are a long-term investor or a short-term trader, this book is an
essential read.”
— Ronald W. Chan, Founder and CIO of Chartwell Capital Ltd., and author of The Value Investors:
Lessons from the World’s Top Fund Managers
“I have found that the best path to stock market success for individuals is to
follow the written strategies of legendary investors with a proven track record.
Robin Speziale has identified 28 legendary investors in the Canadian stock
market and captured in writing the essence of their strategies in his tour de
force, Market Masters.”
— John Reese, CEO of Validea Capital Management and Globe and Mail columnist
“Robin Speziale has written a fascinating book. The interview with the elusive
Francis Chou alone makes it worth it to buy the book.”
— Mohnish Pabrai, founder and managing partner of Pabrai Investment Funds, and author of The Dhandho
Investor
“A wonderful resource for anyone who wants to study some of Canada’s world-
class investors.”
— Guy Spier, Managing Partner of Aquamarine Capital, and author of The Education of a Value Investor
“Robin Speziale’s new book, Market Masters, provides a wealth of insight into
what it takes to succeed as an investor from a group of renowned Canadian
investors. I think every investor would benefit from reading the book. Find out
what group of ‘Master Keys’ fits your investment personality and then, if you
can, rigorously implement them in a systematic, unemotional way. If you manage
to conquer your emotions and use some of the plethora of ideas from this book,
you’ll be well ahead of the majority of investors.”
— James P. O’Shaughnessy, author of What Works on Wall Street
“Only a few investors become great, and they take different paths to get there.
“Only a few investors become great, and they take different paths to get there.
For an investor who wants to be successful, this book provides not just the
recipe that these investors used to get to success, but also insight into their
beliefs, blind spots, and investment philosophies. I recommend it to those who
want to get past cookbook models and to develop their own ways of thinking
about markets and investing.”
— Aswath Damodaran, Professor of Corporate Finance and Valuation at the Stern School of Business at
New York University, and author of Damodaran on Valuation
“One of the most effective ways to improve as an investor is to focus on process
through understanding the processes of better investors. In Market Masters,
Speziale has collected Canada’s best, and provided a rare glimpse into their
methods. The invaluable insights available here will help any investor get
better.”
— Tobias Carlisle, founder and managing partner, Carbon Beach Asset Management, and author of Deep
Value and Quantitative Value
“I have been in the investment business for more than three decades, and there
is still much one can learn from Market Masters. This book should be part of
your personal investment library.”
— Chuck Carlson, CFA, author of The Little Book of Big Dividends
“This book is full of useful nuggets.”
— Vitaliy Katsenelson, CIO of Investment Management Associates Inc., and author of the Little Book of
Sideways Markets
“You excel by learning from people who are better than you. Robin Speziale’s
book gives you the insight on how some of the best investors think. Improve your
success rate by reading this book and learning how the pros think and act.”
— John Schwinghamer, author of Purple Chips: Winning in the Stock Market with the Very Best of the
Blue Chip Stocks
“Market Masters by Speziale is an excellent book and belongs on any serious
investor’s bookshelf. Investors are often trained in a specific discipline which is
learned through apprenticeship. This readily accessible book provides insight
into multiple investment disciplines through interviews with experienced
practitioners. The breadth of knowledge conveyed by Market Masters is both
unique and extraordinary.”
— Mitch Zacks, Portfolio Manager at Zacks Investment Management
To …
Family: Mom, Dad, and Sister.
Grandparents: rest in peace.
All of my relatives: in Canada,
USA, Sweden, and Italy.
Friends. Teachers.
One percent (1%) of the proceeds from the sale of this book will be donated to
SickKids Foundation
If I have seen further than others, it is by standing upon the shoulders of giants.
— Isaac Newton It is not a case of choosing those [faces] that, to the best of one’s judgment, are really
the prettiest, nor even those that average opinion genuinely thinks the prettiest. We have reached the third
degree, where we devote our intelligences to anticipating what average opinion expects the average
opinion to be. And there are some, I believe, who practice the fourth, fifth, and higher degrees.
— John Maynard Keynes, “The Keynesian beauty contest”
One thing I can predict: it is almost axiomatic that the wild enthusiasm of today
will be met with the equally unwarranted pessimism of tomorrow.
— David Dreman
Maximize your ROI from Market Masters
How to get the most out of this book
Let your mind be open. Remove any biases or preconceived notions,
no matter what your level of skill, before you start to read Market
Masters.
Get ready. Accept that you will learn new investment ideas and refine
old concepts.
Want it. Continuously foster a desire to master the strategies that will
be revealed to you by all 28 Market Masters.
Make it yours. Highlight the most important things that you learn
throughout. Dog-ear this book. Jot crucial points into a notepad. Use
all the tools at your disposal so that you can quickly and easily come
back to concepts later.
Key in. After you read each chapter, hone in on the “Master Keys.”
These keys will ultimately help you unlock the market.
Take breaks. Stop throughout and think: how can this or that make me
money in the market? When will I apply it? What should I expect?
Have fun. Imagine that you are there with the Market Masters. Don’t
rush the journey. Perhaps read one interview at a time. Soak it in, and
then come back for more.
Make connections. The Market Masters share common concepts about
the market that have made them successful. Emulate them.
Go back. After you’ve read Market Masters once, read it a second
time, and then a third whenever you feel the need for guidance in a
volatile market or when your portfolio seems to be in disrepair.
Pay it forward. Recommend Market Masters to a relative, friend, or
colleague.
▲
FOREWORD
▼
Knowing how to invest is an essential life skill. While the education system
gives you the tools to earn an income, it rarely tells you how to make your
money last and keep it from running out before you do.
I learned about investing only when I started covering mutual funds at the
Globe and Mail and took the Canadian Securities Course (CSC). I interviewed
so many money managers during my 10-year stint at the Globe that I finally
started to understand how they valued companies and picked securities.
Robin Speziale has interviewed Canada’s top money managers in depth. But
instead of asking what stocks they like — “the flavour of the month” — he
talked to them about the processes they use to find investable securities.
At the beginning of his book, Robin talks about his copious legwork. He had
to pin down 28 strangers and encourage them to open up about their proprietary
ideas and techniques.
Would they return his calls and emails? Would they agree to meet him?
The book you are about to read almost didn’t come together. Other authors
might have given up. Robin kept pushing and he pulled it off.
I said yes to Robin in 2010 when he pitched me about his self-published
book, Lessons from the Successful Investor. By then, I had moved to the Toronto
Star and started teaching an evening course, Investing for Beginners, at the
University of Toronto’s continuing studies department.
“Why don’t you come talk to my students?” I said.
I wanted to see if he could think on his feet in a classroom setting.
Robin aced the audition. Still in his twenties, he had the confidence of
someone much older. He paid tribute to his idol, Warren Buffett, and stayed
within my time limit. That rarely happens.
I invited Robin to my class again the next year. He also gave a presentation
I invited Robin to my class again the next year. He also gave a presentation
to my investment club, Ellen’s Degenerates.
Earlier this year, he asked me to do a foreword for a new book. I didn’t know
the scope of the project until he sent me the manuscript.
My first thought: What a great resource this is for students, instructors, and
do-it-yourself investors.
My second thought: Canada has so many smart money managers. They
deserve to be highlighted in something that lasts longer than a daily newspaper
article or a Market Call show on the Business News Network.
I’ve interviewed some of these Market Masters (Francis Chou, Kiki Delaney,
Paul Harris, Som Seif) and invited some to speak to my classes or club (Gaelan
Morphet, Peter Hodson, Randy Cass, Bill Carrigan). There are also a few people
I know (Derek Foster, Ross Grant, Benj Gallander) who are compelling
communicators about investing, though they don’t actually work in the industry.
Good job, Robin. Yours is the first Canadian book I’ve seen that spotlights
such a wide variety of investing styles. You even included low-cost passive or
index investing.
Readers, you will find this book useful and lively. Instead of going straight
through until the end, you can dip in and out of the chapters as you like, learning
as you go.
Ellen Roseman
Personal finance expert and Toronto Star columnist