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me and my money

Ryan Fraser says he learned best when his money was on the line and he had to deal with the ups and downs. He urges prospective do-it-yourself investors to jump in and take small investment positions as part of the learning process.

Ryan Fraser

Occupation

Former petroleum geologist turned stay-at-home dad.

Portfolio

Larger positions include Royal Bank of Canada, Fortis Inc., Enbridge Inc., BCE Inc., First Capital Realty Inc., Royal Dutch Shell PLC and Coca-Cola Co.

The investor

"My wife Kim and I have built a portfolio of about 30 Canadian and international stocks over the last 14 years," discloses Ryan Fraser. "We started using leverage during the 2008 to 2009 financial crisis," he adds.

How he invests

Mr. Fraser and his wife buy mainly shares in recession-resistant companies that can grow their dividends at or above the rate of inflation. They try to buy when the shares are undervalued.

What made a huge impact on their portfolio's performance was borrowing to invest in blue-chip dividend stocks in 2009. "Dividend yields on Canadian banks were 7 to 8 per cent and we were able to borrow at 3 per cent."

The leveraged portion of their portfolio has since dropped "from 40 per cent to less than 10 per cent." This is due to capital appreciation and "dividends paying down the loan."

They recently took a position in Finning International Inc., a seller of construction equipment. It has a low dividend payout ratio and is expected to do well as infrastructure spending picks up.

Best move

"We've been big winners with Royal Bank and First Capital Realty."

Worst move

After they bought Manulife Financial Corp. in 2008, the company sliced its dividend in half, and the stock nosedived. They sold in 2010 at a 60-per-cent loss.

Advice

While reading books is fine, Mr. Fraser says he learned best when his money was on the line and he had to deal with the ups and downs.

He urges prospective do-it-yourself investors to jump in and take small investment positions as part of the learning process.

Want to be in Me and My Money? Contact Larry MacDonald at mccolumn@yahoo.com