The best-kept secrets of Canada’s smartest investors: Mayers

The best of the best are often written by the masters themselves, not as investment advice per se, but as autobiographical works. They explain how the writers think, which in turn explains how they invest.

That’s why Market Masters (ECW Press, $22.95) by Robin Speziale, 28, a University of Waterloo arts and business grad is so engaging. While it isn’t written by a pro – though one suspects the Mississauga native may one day be one – Speziale sat down with some of Canada’s best money managers. Many have been at it for longer than he’s been alive. The good news is that he just let them talk.

The result (in bookstores and available online) is a rich and engaging look at their guiding principles and strategies. For most readers the managers will not be household names. But these pros manage billions of our wealth.

The 28 interviews reveal how they pick and choose, their golden rules, red flags and lessons from failures and mistakes. The material is more likely to be read by dipping in, than cover to cover to cover, because it is grouped by investing style.

Some managers are value investors. They sift through the wreckage of dreary markets like this current stretch, looking for quality at a bargain price. Others look for growth and the next Google or Apple.

Others apply a mixture of styles, or computer modeling, which has given us so-called robo-advisors.

Bill Carrigan, whose Getting Technical column appeared in the Star for 17 years is one of the featured experts. The book’s foreward is written by my colleague Ellen Roseman.

Speziale got serious about investing at university when he set aside half the money made from his co-op placements. He made the usual mistakes, set out to learn as much as he could and has since amassed a portfolio worth $250,000. He aspires to run his own investment fund one day.

Speziale wrote the book to answer this question: It’s easy to make money when markets are rising, but what should you do when they fall?

“So I sought out the experts, the people who do this for a living,” he says.

Related: 15 rules from a great investing mind

The book is a reality check for times like these when the markets seem particularly dangerous. It may surprise you that the pros are often as perplexed and worried as you are. But they still beat the odds on a consistent basis.

Here’s how they do it:

Lifelong learning: “I read about anything and everything,” says Francis Chou, a one-time Bell Canada lineman, who formed an investment club and now has about $1 billion under management at Chou Associates Management. “Nothing is irrelevant,” he says.

Have a plan: All the pros apply a strategy and once committed, don’t waver. It helps put daily fluctuations in their place. They are disciplined and leave their emotions on the sidelines.

Be patient: We live in an age of instant gratification, but it takes time for investments to pay off. “Practice patient investing while ignoring the pulse of the market,” says Contra The Heard’s Benj Gallander.

Risk management: This includes deciding when to sell, which is perhaps harder than deciding when to buy. It also means diversifying. “If you’re a genius in our business, you’re right 60 per cent of the time,” says Norman Levine of Portfolio Management Corp. “That’s why you have to have a diversified portfolio. You’re going to be wrong a lot.”

Dividends are important: “Great stocks all have something on common,” says Barry Schwartz of Baskin Wealth Management. “They’re quality businesses that raise dividends almost every year (and) sell products and services people use every day.”

As with anything else, it takes a lot of effort to succeed as an investor. If you’re just starting out, or well along the way, you could do a lot worse than put Market Masters on your reading list.

Related: 10 investing rules from Vanguard’s Jack Bogle

More columns by Adam Mayers