Peter Premachuk for MY Money MYMO
Peter Premachuk, 53
Occupation: Regional director for H&R Block franchise operations in Canada
Portfolio: Front Street Growth Fund, TD Real Return Bond Fund I Series, BMO Guardian Monthly High Income Fund II, Mackenzie Cundill CDN Security Fund Series C, Mackenzie Cundill Recovery Fund Series C, CIBC Monthly Income Fund, H&R Block
What works
Being in the tax business, you see just about everything under the financial sun, says Peter Premachuk from Olds, Alta., north of Calgary. "It gives you an idea of what to do and what not to do."
The biggest takeaway from all he's seen is that the big financial winners are the people that stay the course and accept the market's ups and downs. "That's really hard to do when you see your portfolio sliding, but you have to learn to take the emotion out of it."
Dealing with cycles
"I usually ignore them, but the last one was the hardest one, mostly because of my advancing years," he says. While he admits to wanting to simply sell and move everything to cash, what was a great help was talking to others who were in the same boat. "It's like being part of a club, so you don't feel quite as bad as it gets down."
The value of perspective Mr. Premachuk has a rather unique approach to bolstering his stay-the-course approach to investing: "I talk to a lot of business people, from house builders to furniture store owners to farmers, and you learn that cycles impact everybody." What he's learned? When you're managing your money there will be good years and bad years, similar to those experienced by business owners. But that's not enough in itself for them to close up shop, and neither should it be reason to pull one's money out of all investments.
Readjustments
"For the most part you have to have a philosophy and be patient with the philosophy. But that shouldn't stop you re-evaluating things every six months or so." These days, Mr. Premachuk is reviewing his U.S. holdings, given his concern over the impact of upcoming mortgage renewals. "The U.S. may be in another situation where the growth isn't going to be there, so I have to look at my funds and see if they're positioned to take advantage of that and keep performing."
Best Move
Mr. Premachuk likes his Cundill funds, which performed well when he first got in, spent a few years in the middle of the pack, and are now faring well again. But his take is it isn't so much the fund itself that makes for a good performer as one's timing. "You could talk to people that are in a fund, and whether they liked it or hated it would depend on when they got in."
Worst Move
U.S. RBC O'Shaughnessy U.S. Value Fund, which has a five-year average annual compound return of minus-5 per cent, while the index returned minus-2.8 per cent. The fund had a great year in 2009, posting a 24.8-per-cent return compared with the index's 8.1 per cent, but much of that was recovering from 2008, when it dropped 44 per cent, compared with the index's loss of 21.9 per cent.
Mr. Premachuk hasn't fared much better with the RBC O'Shaughnessy U. S. Growth Fund, which has a five-year return of minus-10.8 per cent against the index's minus-2.4 per cent.
Special to The Globe and Mail
Want to share your strategies? tony.martin@sympatico.ca