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A View From Here October 2017

October 5, 2017 • Print This Article

A View From Here - October 2017

"A Ship in a harbor is safe, but that's not what ships are made for". - John A. Shedd

2017 has been a challenging year for Canadian investors in light of the strength in the U.S. markets that are at all-time highs. The benchmark TSX index remains lower than last year and essentially at the same place as it was in 2008, despite economic growth that exceeds expectations and more recently, a strong dollar. This has created a tremendous amount of anxiety for Canadian investors as we watch U.S. markets reach all-time highs on a weekly basis despite geo-political tensions, a controversial White House, and what appears to be a divided nation south of the border. There is an old saying that 'markets climb a wall of worry' and there might not be a better proxy than what we are seeing in the U.S. But economic growth usually leads to higher valuations, and I am optimistic that we will see this in due course.

Our accounts have not been immune to the weakness this year and the recent strength of the Canadian dollar has added to another layer for our investment accounts to overcome. After hitting all-time highs in April, our investment accounts have consolidated since weakness of the values, particularly in some of our retail & media investments and the strong Canadian dollar vis-à-vis the U.S., as it is the currency that many of our investments are valued in. Throughout the winter we have been building up cash levels and in the case of newer accounts maintaining larger cash positions for future investment. During the spring and summer periods, we kept unusually quiet, due to the fact that a malaise existed not only in our investment holdings, but also to other companies we follow as potential candidates. As such, I felt that we might only putting gasoline on the fire. I believe in our deep understanding of the value proposition that each holding represents and what they can achieve for our accounts at some point in the future and this period resembles the back half of 2015 into early 2016 where no matter where you were, things were challenging. But in an 'all of a sudden' moment, things began to wake up in early March of 2016 and presented our accounts with a great performance by year's end.

We don't believe in being idle for long because we are looking to build wealth over the long-term and while a ship in the harbor is safe, it is not what ships are made for.

Market Weakness is Ultimately an Opportunity

"Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections than has been lost in corrections themselves." - Peter Lynch.

One of the constant traits of investors is fear of a total loss of capital and nothing speaks louder than the 2008-2009 where markets fell over 50%. I often get correspondence suggesting that perhaps we should sell all or a large portion of our holdings to wait out a potential market collapse and then come back in at the bottom, but this action rarely yields investment success. There is always going to be corrections and no one knows when they are going to occur or why corrections happen. Investors are continually searching for reasons for stocks to fall. It almost becomes a game for some to say that they can predict the exact event that does it and there's always something to fear that will possibly derail the markets - profit margins, valuations, earnings shortfalls, economic growth, rising/falling interest rates, inflation/deflation, geopolitical risks and the list could go on forever. Occasionally these issues 'matter' but other times the market simply shrugs them off. Look at what is happening south of the border and around the world. Does this feel like the trappings of all-time high market valuations?

The opportunity in a weak market is to participate in the phoenix that rises from those ashes. Looking back on previous malaises, for example, will show how our accounts saw all-time highs in October of 2007 and exceeded those numbers in early 2010, and enjoyed much higher valuations in the subsequent years. It is coming out of those periods that produce significant returns and for those concerned, I would refer to our long-standing track record of success, which is something few have been able to achieve. It's just that it's never an easy ride.

Thanks for taking a look and as always,

All Good Things,
Adam

Adam Hennick
Mackie Research Capital
Tel: 416 860-6848 Toll Free: 1-877 860-6848
www.adamhennick.com

Filed under: Uncategorized

The opinions, estimates and projections contained herein are those of the author as of the date hereof and are subject to change without notice and may not reflect those of Mackie Research Capital Corporation ("MRCC"). The information and opinions contained herein have been compiled and derived from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. Neither the author nor MRCC accepts liability whatsoever for any loss arising from any use of this report or its contents. Information may be available to MRCC which is not reflected herein. This report is not to be construed as an offer to sell or a solicitation for an offer to buy any securities. Member-Canadian Investor Protection Fund / member-fonds canadien de protection des épargnants.

Mackie Research Capital Corporation (MRCC) makes no representations whatsoever about any other website which you may access through this one. When you access a non-MRCC website please understand that it is independent from MRCC and that MRCC has no control over the content on that website. The content, accuracy, opinions expressed, and other links provided by these resources are not investigated, verified, monitored, or endorsed by MRCC.

 

A View From Here May 2017

May 5, 2017 • Print This Article

A View From Here - May 2017

"Your meters may overload, you can rest at the side of the road. You can miss a stride but nobody gets a free ride. More than high performance, more than just a spark, more than just the bottom line, or a lucky shot in the dark" - Rush: Marathon

A Test for Echo

The past months have felt like an echo of the challenging conditions of mid-2015 through February 2016. During that period, a majority of our positions languished and we augmented our investments through additional purchases. We were rewarded for our conviction as the year drew to a close. While the strength of our accounts advanced into the New Year, it has been largely based on the heavy lifting of just a few of our holdings (thanks FirstService, Colliers and Constellation) while the majority seem to 'wink' facetiously at us as they grind lower in a test of resolve. With major stock market indices within a few percent of all-time highs, this challenge brings out that old anxiety that I've been learning to make friends with for a long time.

We operate in the investment back streets that rarely track the stock market, especially in the short-term. As such, we must constantly scrutinize each investment thesis for some unforeseen occurrence that might have not previously been considered. This work never ends until an investment is closed out. I have spent a particularly large amount of the previous months, speaking with and/or taking daylong excursions to the head offices to meet with the senior management to confirm our view. I take some comfort in knowing that many of these executives' personal net worth is tied to the success of the companies we hold. In some cases, management has been purchasing shares at current levels (Leon's & New Media).

The companies we own are 'not necessarily promotional' when it comes investor relations. This is often because management owns a significant personal stake in the business and maintains an adverse view of capital market professionals. It is interesting to note that as a group, we are among the largest shareholders of these businesses making our presence more of that as a partner than an adversary. At least half of my day is spent reaching out to other large holders and industry analysts in an effort to share thoughts. These dialogues are very important in uncovering aspects of the business or industry that we might not be seeing. In a lot of cases, I have remained close with many of these individuals long after the positions are sold as it stands to reason that if we successfully shared knowledge at one point, there is no reason why the dialogue ends when the position is sold.

Hold Your Fire

"Dreams don't need to have motion to keep their spark alive. Obsession has to have action, pride turns on the drive." - Neil Peart: Hold Your Fire

I believe investment success is achieved by having as much knowledge as possible and that this deeper understanding will ultimately yield profit and limit losses over the long-term. This effort cannot be lost to hope or ego and proceed with caution, humility and the patience for our variant perception of value is to be realized. It is especially true within a concentrated portfolio of holdings, which is the only way I have seen investment success over the long-term. Our record has always been built upon a focus (dare I say - obsession) to comprehend value, especially at times when an investment valuation increases during recognition or conversely, lower during apathy or adversity. It stands to reason that if we can have a deeper understanding of our investments, then we are more likely to make the most informed decision whether to buy or sell.

In each investment we hold, the share price tends to fluctuate due to changing investor perceptions. When starting a new investment position, we take a modest position at the outset because I just know that the share price will likely surprise us on the downside. It's a sort of a cruel joke that on one hand tests our resolve but makes sense when you realize that we are looking outside of the box for value. Because we purchase investments in companies that are usually out of the investing public's mind, we look to use the ups and downs to our advantage by adding to weakness as long as corporate developments maintain our investment thesis. It also serves to limit our losses if an issue that we failed to see at the onset manifests during its tenure. In the past five years we have had a limited number of investments that were closed out at a loss that thankfully were among our smallest holdings. While they might have brought down our returns in the short-term, our long-term track record speaks for itself.

Despite increased geopolitical implications from Syria, Russia and North Korea, or the at home with the fear of Canadian real estate over-valuation, free trade, challenged independent mortgage lenders and the weak Canadian dollar, stock markets remain somewhat healthy in my opinion. The anxiety that has persisted since the lows of March of 2009 continues to perpetuate markets higher despite concerns of that they might be too high. Ever since I have been in the business of investment advisory, I've been told that a bad ending is always near. It doesn't feel that way right now and because we cannot see the future, we'll forge forward in the present.

The business of managing investments has its manic-depressive side but we have a track record of success that few have been able to achieve and a process honed for a long time. As a large shareholder in the same companies you hold, I hope that it continues.

Lastly, I was honored to be interviewed by the Globe and Mail which appeared on April 17, 2017.

Click here to read.

Thanks for taking a look and as always,

All Good Things,
Adam

Adam Hennick
Mackie Research Capital
Tel: 416 860-6848 Toll Free: 1-877 860-6848
www.adamhennick.com

Filed under: Uncategorized

The opinions, estimates and projections contained herein are those of the author as of the date hereof and are subject to change without notice and may not reflect those of Mackie Research Capital Corporation ("MRCC"). The information and opinions contained herein have been compiled and derived from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. Neither the author nor MRCC accepts liability whatsoever for any loss arising from any use of this report or its contents. Information may be available to MRCC which is not reflected herein. This report is not to be construed as an offer to sell or a solicitation for an offer to buy any securities. Member-Canadian Investor Protection Fund / member-fonds canadien de protection des épargnants.

Mackie Research Capital Corporation (MRCC) makes no representations whatsoever about any other website which you may access through this one. When you access a non-MRCC website please understand that it is independent from MRCC and that MRCC has no control over the content on that website. The content, accuracy, opinions expressed, and other links provided by these resources are not investigated, verified, monitored, or endorsed by MRCC.

 

A View From Here April 2017

April 5, 2017 • Print This Article

Knowing the Knowable

Despite recent weakness, the overall strength of worldwide stock markets has many investors anxious due to its ascension. With so many distrustful of the new U.S. president how could the markets move higher in what has been dubbed the 'Trump' rally? Outside of a perceived 'pro-business' culture in the White House, perhaps this strength has less to do with politics and more to do with the actual fundamentals. Market volatility at all-time highs creates the kind of contrarian thought that we've reached too high, too far and too soon, so we're best to sell positions and ride out the pending sell-off. Market 'watchers' claim that this current bull market which now extends over eight years is the second longest in history. Surely something has to give? When I broached this subject with a market analyst whose publication we subscribe to, he reminded me that records are broken all the time and that's the stock market.

The reality is that we don't have to know the market's future to be good investors. There is a great belief that the macro (overall economy) rules the markets so we should figure out things like when the Fed is going to stop stimulating the economy and raise interest rates or what's going to happen in Europe or China and invest accordingly. These are the things that move markets so isn't that where we should spend our time? The interesting conundrum is that in the short run they are the things that will move the market, however, these things are unknowable and as such, a waste of our time to pursue. Instead we should know the knowable which is to have an advantage over other investors with regards to companies, industries and securities. These are the things that pay off with hard work and skill...and maybe a little luck as well.

The Professor

One of my first clients was a professor who became adamantly negative on the markets in 2002 after reading a book on the pending economic apocalypse. After a few discussions he instructed me to sell all of our positions and in its place, purchase 'put' options that would profit when the market collapsed and concurrently, buy shares in gold producers. The thinking was that he would not only profit when the market collapsed but his returns would be further enhanced by the anticipatory increase of the price of gold. The concept of owning gold is pretty archaic as it assumes that paper money will have little or no value in an economic collapse, suggesting that we will buy goods and services with gold. That's how people purchased things in the markets along the Nile River before time began, I think. In my professional career (or lifetime for that matter), nothing has come of it, but hey, anything can happen and there's a never ending list of people who have been warning me my whole career. Haven't met a wealthy one though...and I think that's a very important fact.

Shortly after the professor sold his holdings and repositioned his account, the markets sold off heavily throughout the fall of 2002 and into 2003. In fact, I found it to be the most challenging time for our investment accounts in my career. While his repositioning had a profitable outcome, it was a far more modest increase than he expected. But when markets (and by extension, our investments) began to recover in the spring of 2003, he couldn't let go of his apocalyptic view that the other shoe would soon drop. As such, he remained averse to making future investment commitments and his account never achieved much growth. The professor didn't participate in and never saw the returns the rest of us were achieving. He ultimately moved his account to a discount platform, which made sense if you weren't following my advice. I've often thought about what he missed out on in the years that followed and his story remains a lesson that pessimism is a luxury that few can afford.

Market sell-offs have an adverse effect on investment accounts in the short-term, but offer a tremendous recovery potential. Nothing becomes more true than the adage - 'what doesn't kill you makes you stronger' than having the fortitude to augment a stake in a business when few want to. In what is now being dubbed as 'The Great Recession', the consolidation of values in excess of 50% from the peak in October 2007 to its trough in February 2009 (16 months) during the worst sell-off - ever presented tremendous opportunities that most of us took advantage of. By November 2010, our accounts had again reached new all-time highs and have continued to do so over the next seven years despite the occasional setback (specifically, 2011 and 2015). We all want the instant gratification of performance, but unfortunately, it just doesn't work that way.

In the end, I think it is important to recognize that there is little we can do to protect ourselves from what we don't know is going to happen. The best thing we can do is to understand the inherent value of each investment we hold. That way we can calmly make decisions based on a fundamental view rather than an emotional one. Understanding adversity is a significant part of investment management. Things are rarely on an easy path and a change in valuation that will lead to a profitable exit, doesn't necessarily follow our expected time frame.

Joel Greenblatt, (one of my investment gurus) who teaches at Columbia University Business School, said; "I make two guarantees to my students on the first day of class; first guarantee is this - if they do good valuation work, the market will agree with them, I just don't tell them when. The corollary to that is this - and it's very powerful; I tell them that in 90% of the cases for an individual stock, two or three years is enough time for the market to recognize the value they see, if they've done good work. When you put together a group of companies, this can actually happen a lot faster. Both of those are very powerful and it says that good work will be rewarded."

A change in market sentiment doesn't guarantee that investments act in a certain matter. While it's true that during a panic such as 2007-2009 and even broad sell-offs in 2015, our investments for the most part are affected but they generally move by their own merits. Who can really say why Colliers and FirstService which augmented returns in our accounts so well in 2015, sold off in 2016 only to achieve all-time highs in early 2017? I'm just glad we had the fortitude to add to existing positions at lower prices. These are things that you just can't predict, in the short-term, but if we know why we own a business and the inherent value, then it becomes more reasonable to believe that they will be worth more in the future.

With the first quarter of 2017 in the books, I'm happy that our accounts have extended the returns beyond the strong 2016 we witnessed.

Thanks for taking a look and as always,

All Good Things,
Adam

Adam Hennick
Mackie Research Capital
Tel: 416 860-6848 Toll Free: 1-877 860-6848
www.adamhennick.com

Filed under: Uncategorized

The opinions, estimates and projections contained herein are those of the author as of the date hereof and are subject to change without notice and may not reflect those of Mackie Research Capital Corporation ("MRCC"). The information and opinions contained herein have been compiled and derived from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. Neither the author nor MRCC accepts liability whatsoever for any loss arising from any use of this report or its contents. Information may be available to MRCC which is not reflected herein. This report is not to be construed as an offer to sell or a solicitation for an offer to buy any securities. Member-Canadian Investor Protection Fund / member-fonds canadien de protection des épargnants.

Mackie Research Capital Corporation (MRCC) makes no representations whatsoever about any other website which you may access through this one. When you access a non-MRCC website please understand that it is independent from MRCC and that MRCC has no control over the content on that website. The content, accuracy, opinions expressed, and other links provided by these resources are not investigated, verified, monitored, or endorsed by MRCC.

 

A View From Here March 2017

March 6, 2017 • Print This Article

"The stock market is filled with individuals who know the price of everything, but the value of nothing." - Philip Fisher

The Most Important Thing is Return

There has been a series of marketing campaigns by unproven 'Robo-Advisors' as the low-cost alternative to wealth management. Since most have failed to provide adequate long-term returns, will this portfolio of exchange-traded funds (ETFs), that uses algorithms to create asset mix, prove to be a good choice? It is unlikely in my opinion. Ultimately, someone involved in the process must be adept at making good investment choices and fees are often blamed for the lack of satisfactory returns most investors achieve. This pursuit of saving money often costs us more in the end... no matter the product or service. I think it is safe to say that most would pay a premium for a better return, yet many have been so disappointed in that quest that they look to fees as a key element to achieve performance.

But this isn't anything new. A survey I recall from the 1990s concluded that Canadians have two concerns with financial services: fees and to not lose any money. As a result, actuaries who build financial products on behalf of financial institutions create 'solutions which embed a premium fee and reduce volatility. This usually comes at the cost of performance. I maintain that outside of the safest investments (GICs. Gov't Bonds and Treasury Bills) enhanced returns are only going to come from those who are proficient at investing. Case and point; new clients who transfer their investments to us. Their assets are usually smaller than similar-aged clients who have been with our practice for at least five years. Further, there seems to be the unanswered question as to what exactly the long-term returns have been even though that information is just a click away for every advisor or manager. Most have said that they had been thinking about making a change for many years, but have been too afraid to do so because the returns do not seem possible given their history and their concern over fees.

Fee Structure History

I have witnessed an evolution of fee structure over my tenure from commissions to deferred sales charges on mutual funds that hid a whopping 5% upfront charge and a 2+% trailer, in the 1990s and into the new millennium. As hedged and managed funds became more popular in the early 2000s, the advisory business moved in the direction of a percentage fee charged on assets managed. This appealed to many as it supposedly addresses a perceived conflict of interest from the traditional commission based structure. However, this wasn't always the case, as additional commissions were still paid to advisors from new and secondary issuance of shares and structured products created by firms. If you think about it, if advisors were not getting paid to place them, they might not be placed at all. It took the better part of another decade for these 'extra' fees to be essentially banned. As such, the cost as a percentage of assets managed has come down to the point that advisors focus on building scale by procuring new assets and offering financial and estate planning services in an effort to get a larger share of their client's wallet. This has essentially moved the actual practice of investing and planning the "cookie cutter solutions" to third party managers, often within the firm they work for. This is okay as long as the products and returns are satisfactory. Most often they are not.

A couple of weeks ago, my wife Alison and I had dinner with old friends who have been clients for well over a decade. When they brought up the success of their long-term performance, I said; "if you told anyone, they wouldn't believe you". The answer was that when they talk of their success, most don't believe it and are fixated on what fees they would be charged.

I believe that investors who are focused solely on what they pay must have accepted long ago that there is no satisfactory performance. This might have a lot to do with the decades of different fee structures that produced the same meager outcome. They might have determined that despite moving from money manager, to broker to mutual fund, that it is perhaps the fee that is holding them back from a decent return. I believe that most advisors carry that dark secret with them. Many say that it is not performance that matters, but instead helping clients achieve their goals that does. Isn't that the same thing? Where was it lost that the most important thing is the bottom-line return? What other practice does a financial advisory business bring to the table that eclipses this?

Good money management shouldn't be cheap and if done well - is a bargain. In January, all accounts received a performance and fee report that the regulators have mandated clients receive annually. In last month's A View From Here, I suggested that you look at this document or ask us to provide one for you. It exposes your performance, which is inclusive of all fees.

Commission versus Flat Fee - The Uphill Battle

On the surface, the commission model seems to be a conflict of interest between advisor and client as it suggests that advisors would attempt to make as many transactions as possible to earn more in fees. In order to address this, I must first say that trading is a terrible way to invest as it moves into the realm of gambling, and a stigma that has followed financial services for decades. As such, trading an account often without a defined investment mandate is like playing with a bar of soap in the shower; eventually there will be nothing left. In 1975's Play it Again Sam, Woody Allen was asked why he doesn't invest in the stock market. His character answers, "I don't' like stockbrokers, they invest my money until it's all gone." A flat fee based on assets is supposed to level that playing field but I don't believe it does. Any fee structure is okay as long as there is a satisfactory long-term return... again - the most important thing and why people ultimately hire financial advisors in the first place.

Advisors who are in it for the long haul know that the more we transact even in absence of a fee, the worse the return is likely to be. It will ultimately come at the cost of the business relationship over the long-term. What I prefer about our commission model is that once a transaction is made, there is no fee paid until another one is made. Last month we began to close out one of our long-term holdings. We had owned this business for almost seven years. That's seven years that we tracked, scrutinized and ultimately decided to remain invested in while no fee whatsoever was paid to do so. The return over the tenure speaks for itself.

There has been a lot of buzz in the investment industry about outlawing commissions, which has occurred in both the UK and Australia. Yet I still believe that at this point, it is the best approach for our accounts. Perhaps in the end, we will determine that a different structure is more appropriate, but it does not dismiss the fact that in the end...it is all about the return on your invested assets. Anyone who tells you different is unlikely to be achieving it and they know it.

Thanks for taking a look and as always,

All Good Things,
Adam

Adam Hennick
Mackie Research Capital
Tel: 416 860-6848 Toll Free: 1-877 860-6848
www.adamhennick.com

Filed under: Uncategorized

The opinions, estimates and projections contained herein are those of the author as of the date hereof and are subject to change without notice and may not reflect those of Mackie Research Capital Corporation ("MRCC"). The information and opinions contained herein have been compiled and derived from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. Neither the author nor MRCC accepts liability whatsoever for any loss arising from any use of this report or its contents. Information may be available to MRCC which is not reflected herein. This report is not to be construed as an offer to sell or a solicitation for an offer to buy any securities. Member-Canadian Investor Protection Fund / member-fonds canadien de protection des épargnants.

Mackie Research Capital Corporation (MRCC) makes no representations whatsoever about any other website which you may access through this one. When you access a non-MRCC website please understand that it is independent from MRCC and that MRCC has no control over the content on that website. The content, accuracy, opinions expressed, and other links provided by these resources are not investigated, verified, monitored, or endorsed by MRCC.

 

A View From Here February 2017

February 2, 2017 • Print This Article

"It's not how right or how wrong you are that matters but how much money you make when right and how much you do not lose when wrong" - George Soros

True North

The market's upward ascension has extended into 2017 as the inauguration of perhaps the most controversial U.S. president took office. I remain impartial to the new administration as policies are unlikely to have any effect on our investments. While so many are fearful and others downright hateful of Donald Trump's presidency, markets have been extremely bullish, suggesting that the great unknown had a positive effect on investors. For the better part of January, the Dow seemed to be setting up for and finally broke through the coveted 20,000 point ceiling. When I entered the financial services industry in January 1988, the Dow Jones had closed the previous year at 1,950. We've come a long way.

One of the more interesting aspects to the new presidency has been renewed optimism of a better business climate. Many companies I have spoken to, through conference calls or management meetings, speak of this administration as potentially benefitting their businesses. Many point to an accommodative corporate tax structure, pipeline or infrastructure spending. Could it be that this administration is prepared to take action (be it contentious or not) whereas the outgoing one appeared to have its hands tied? We'll see.

The Unforeseen

I believe that the day to day valuation of corporations is distilled from all known information and that it is what we don't know that affects its share price. It is the unforeseen that changes valuations. Charles Dow, the journalist who founded the Dow Jones Industrial Index has said, "To know values is to know the meaning of the market."

In 2007, few if any had anticipated that mortgage-backed investments had the power to sink world markets, and even those who did, probably didn't anticipate the full extent of the damage which occurred. I suspect that few expected a Donald Trump victory or the Brexit vote for that matter and even fewer would had anticipated that world-wide markets would respond so positively following these events - especially when election night pointed to almost a 1000 point drop in the U.S. market futures as it was becoming clear that Trump was the likely winner. Perhaps this unforeseen circumstance mixed with better economic numbers and corporate earnings, has propelled markets upward.

There is a lot of concern that markets are in a euphoric stage that will fizzle once sanity kicks in. If there has been one constant in my career it is that view, as it touches that special place in the gut that lives in fear. But for what it's worth, I've never met a wealthy pessimist. In fact, according Benjamin Graham - the father of value investing (the method we use to invest on your behalf), "To be an investor you must be a believer in a better tomorrow." I maintain that as markets continue to rise and concern remains predominate in the collective investment psyche, it is less likely to occur. I think markets peak when everything is maybe just a little too well.

The Idiot Behind A Desk

While my 'idiot behind a desk' view is that it is not the case right now, I would not be surprised by how markets consolidate before something better happens. But this transition period, (if it does occur) may or may not have much effect on our investments. They will rest on their own merits. Respected fund manager, Peter Lynch put it best when he said: "Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves". So there is little, in my opinion, that we should change in the way we are managing our investments. I believe that our holdings are well integrated into our accounts and would continue to use conviction or lower valuation to augment existing positions rather than close them out in anticipation of what we don't know will happen.

"Bull Markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria" - Sir John Templeton

This might be one of the most singularly powerful quotes on all things markets to have ever been spoken. Thinking about where we might be at this time, I do not see euphoria.

January turned out to be a successful month for our investments based on some early reports of sales, an increase in the interest rate on our favorite corporate bond, and what could be a seismic shift in an Oil & Gas services company that has me believing in very exciting possibilities for wealth creation over the next several years.

By now you should have received the newly mandated fee and performance review. Please take a moment to review these numbers, as we are most proud of our returns, especially in terms of the fees you pay, and the uphill commission versus the 'flat fee' alternative that has embraced the financial industry. I believe in what we do as demonstrated by the long-term performance for our accounts, which few have been able to achieve.

Thanks for taking a look and as always,
All Good Things,
Adam

Adam Hennick
Mackie Research Capital
Tel: 416 860-6848 Toll Free: 1-877 860-6848
www.adamhennick.com

P.S. - RRSP Contribution Deadline - March 1st 2017

The RRSP deadline for the 2016 tax year is March 1st. I have been a steadfast believer in the value of registered accounts as excellent investment vehicles. I see them as our real life insurance, as in money we will use in our lives, not in our demise. That's best left to our descendants. Also, Canadians over 18 are allowed to contribute up to $5,500 into their TFSA (which has a cumulative value of $51,500 since being introduced in 2009). I believe that this investment vehicle is one of the most powerful options we have and would recommend to anyone who has not participated, to consider doing so. It's painful to pay taxes on capital gains and income, and this is the one investment account that you are exempt from doing so. You can take out the funds without any taxation and replace it in the next year. It's just that good.

Filed under: Uncategorized

The opinions, estimates and projections contained herein are those of the author as of the date hereof and are subject to change without notice and may not reflect those of Mackie Research Capital Corporation ("MRCC"). The information and opinions contained herein have been compiled and derived from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. Neither the author nor MRCC accepts liability whatsoever for any loss arising from any use of this report or its contents. Information may be available to MRCC which is not reflected herein. This report is not to be construed as an offer to sell or a solicitation for an offer to buy any securities. Member-Canadian Investor Protection Fund / member-fonds canadien de protection des épargnants.

Mackie Research Capital Corporation (MRCC) makes no representations whatsoever about any other website which you may access through this one. When you access a non-MRCC website please understand that it is independent from MRCC and that MRCC has no control over the content on that website. The content, accuracy, opinions expressed, and other links provided by these resources are not investigated, verified, monitored, or endorsed by MRCC.

 

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