Rational Advisor

So, I am at the Suites on King, a very neat hotel, where every room is a suite.

Tonight’s dinner was with Dan Bain, the manager of the Dividends and Bonds portfolio. He has an approach that led him to avoid the technology crash and the income trust crash. Why hadn’t I met him ten years ago!

His approach is called Value-shift. This involves doing a global economic analysis, and determining where the worries are. He looks at where we are in the economic ccyle and shifts between value and growth depending on the place within the cycle. He primarily uses dividends that trade below or close to intrinsic value and Bonds, and has a great track record.

What were his key comments
- interest rates to come down globally
- has a higher weight to global dividends 55% about 25% in Bonds and the rest in cash.
- Within dividends the banks are now giving yields greater than 10 year bonds. This is the best it has been since 1950. So, am really concentrating on finding the better banks - not all banks, just the ones that have better valuations.
- US will not be in a recession.
- Bonds have a shorter duration but am planning to go longer, since rates will fall, sometime next year.
- can trade at this parity level in C$ for a while
- Oil can also stay at this place for a few months
- Expect it to do well by having dividends and Bonds.

Rational - I didn’t fight my way to the top of the food chain to be a vegetarian.

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