Jump to content



Recommended Posts

It's better to look at WHAT you invest in WHEN you invest.

They are not the same thing.


A 'widows & orphans' company cutting its dividend (ideally to zero) is a pariah to many - to us it's a prime opportunity.

DB facing a 14B fine, BP facing Gulf Coast exposure, FFH facing bankrupting investments, TransCanada, Telus, Manitoba T&T, NT & PWT financial restatements, etc. ... are all similar opportunities - & the list is endless. They are generally bigger firms, they've done something stupid, & they're paying the piper - & you're betting against the professional raid baiting of the mob.


Were this a street riot there would be tear-gas, police in riot gear, burning vehicles, & media images of water cannon beating back crowds. Were this riot in a popular place, social media would be pushing propaganda images to sell the 'story', & governments would be using gag orders to starve the information flow. The 'flash point' that starts it, the images, the 'back story' ... are professional raid baiting.


Rioting collectively destabilizes a regime (or company), but the individual riot (div cut, well blow-out) typically does not topple it (collapse, etc.). Authorities react with suppressive actions (management change, breakups, demonstrated financial strength), & for a time - stability returns. Whether it continues ... is something of a debate.


You are investing with the angels, the overall process is pretty predictable,

& there are lots of demons lighting fires.



Link to comment
Share on other sites

Except for 1 small cap (700m), I'm 70% large cap and 30% mid-cap on the theory that larger equals strength and past success which lead to continued success and - depending on what you bought - less downside in a correction.  That's just me. In a parallel universe, I can imagine decent portfolios of growing small caps or severe mispricing in smaller companies. Of course you have to keep your eye on the economics, asset quality, and future prospects, no matter what you own.


Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Create New...