Action List Worth A Look

Our Canadian research comes from National Bank. Since November, 2009, they have produced an Action list where their analysts provide their best ideas. In conjunction with their recommendations, they also recommend when to sell these holdings based on price appreciation or earnings surprises.

From November 30th, 2009 to June 30th, 2010, 27 names have appeared on the list with 13 still on the list. In the last quarter, five names were removed while six were added.

In the last quarter, the NBF Action List returned 3.76% vs. -0.33% for the TSX. Since November 30, the Action List netted 6.13% vs. 0.81% for the TSX.

The Action List is updated daily. To get the current action list, please don’t hesitate to contact us and we would be happy to email or send you a copy.

Have a great weekend. Your comments are always appreciated.


Canadian Investment Idol Competition

We would like to congratulate Mr. Joseph Weisz of Montreal, Quebec for winning the first Rothenberg Capital Management Canadian Investment Idol Competition powered by Claymore ETF’s. Mr. Weisz had a return of 15.02% over the eight week time frame.

To view all of our weekly winners, you can click on the link HERE.


Have a great week.

Fundamental Indexing Outperforms in Last Year

Fundamental Indexing is a strategy which ranks and weights companies, not by market capitalization but instead by four fundamental financial data points (cash flow, dividends, book value and revenue).

The portfolio gets rebalanced annually and typically overweights companies that are considered value oriented vs. growth oriented.

The strategy was developed by Rob Arnott and his company Research Affiliates. Many have argued that fundamental indexing is a flawed form of indexing. This post is not going to get into the case for or against fundamental indexing but the returns have been compelling against major indexes.

As of June 30, 2009, the TSX Total Return Index was down 25.69% while the FTSE RA Fundamental Canada Index was down only 12.22% outperforming the market by more than 13%.

The US equivalent outperformed the S & P 500 Total Return Index by more than 5% and the global equivalent outperformed by just under 2%.

The 10 year numbers are also quite compelling with fundamental indexing outperforming its benchmark by 2% – 4% in each of these markets. With these results, ignoring fundamental indexing as a viable strategy can cost you performance over the long run.

To learn more, you can click on the following link here.

To find out how to add fundamental indexing to your portfolio, please do not hesitate to contact me.

Your comments are always greatly appreciated.

Buffett Hits Home Run with Goldman Sachs

A short eight months ago, the media was asking whether Warren Buffett, the worlds most astute investor according to many had lost his touch after placing large bets on Goldman Sachs through his investment fund, Berkshire Hathaway.

Goldman Sachs reported a record profit for the quarter as its stock has gone from a low of $47.41 to its current high of $165  giving Berkshire investors a return of 44% in just  a few months. Ordinary investors shunned the thought of sinking funds into a US based financial firm and financial advisors would be fired by their clients for recommending such action.

Give credit to Buffett for placing his money where his mouth was. He was one of the few and these bets are why he continues to do well. On one of my previous blog postings, I attached a New York Times article that Warren Buffett wrote outlining his conviction for investing and Buying American which you can read by clicking here.

Only time will tell if he is right but 60 years of following his conviction and being one of the richest men in the world because of it provides some backing.

Your thoughts and comments are always appreciated. Have a good weekend.

Microsoft and Google Fight to the Finish

Google and Microsoft look to bury each other with damage to each being a certainty. Microsoft earns most of its revenue from two sources, Its Office software suite and Windows operating system licensing fees.

Google earns most of its revenues from paid search advertising. Both firms have been encroaching on each others territory and both will probably become weaker due to it.  Google launched its own suite of software via the web challenging Microsoft as the suite is offered at no charge creating some painful decisions for Microsoft.

 Google also announced it would be launching its own operating system for computer users and the system would be free as it tries to do what Microsoft has done to many competitors in the past. Offer services for free that would bury the competition as there revenue source dries up.

 Microsoft is fighting back however as it announced that there will be an online version of its Office suite available to compete with Google’s version. They have also stepped up their search engine presence with Bing which has been starting to gain market share on Google although it is too early in the game to know if it will be successful.

If Microsoft can gain market share and generate a greater share of paid search advertising revenue, it can put a dent in Google’s bread and butter. As each encroaches on each others territory, the costs to each will be painful but ultimately better for computer users around the world.

Your thoughts and comments are always appreciated.

What to Look For in a Financial Advisor?

A Bernie Madoff type ponzi scheme reared its head in Canada this weekend with the discovery of $50 million in potential investor losses care of alleged financial advisor, Earl Jones. What was of extreme interest was that he was not registered as an investment advisor at all.

Unfortunately, this is not the first time this has happened and it won’t be the last as there are other so called advisors working hard to manage your money.

How can regulators regulate an advisor if he or she isn’t an advisor? How can investors place trust in an advisor that does not have the credentials to be one?

The Investment Industry Association of Canada (IIAC) has done a good job of providing some information on what an individual should look for when shopping for a financial advisor. Their website is a good place to start but I have gone one step further in providing a page on our website with three of their publications.

As we can see from the Madoff and Jones incidents, performance should not be the sole measure of success as their performance could not be measured since investors received their monthly cheques for years without incident until funds stopped coming in to pay existing clients.

To read the IIAC publications on choosing a registered investment advisor, you can click HERE

Your thoughts and comments are greatly appreciated.

The Week Ahead

It will be a busy reporting week on the economic front with month over month Producer Price Index and Consumer Price Index numbers coming out early in the week.

Initial jobless claims and continuing claims are being reported Thursday while Housing starts and building permit numbers will be reported on Friday.

On the earnings front, not many companies will be reporting next week. Alimentation Couche-Tard reports on Tuesday with consensus estimates coming in at .118 per share.

Corus Entertainment reports on Wednesday with expectations at .429 per share and Nexen reports Thursday with expected earnings per share of .284.

US earnings can be found by going to

Have a great weekend