Includes shares in Bank of Nova Scotia, Royal Bank of Canada, Canadian National Railway Co., Metro Inc., Saputo Inc., BCE Inc., Rogers Communication Inc., Enbridge Inc., Berkshire Hathaway Inc., Coca-Cola Co. and Johnson & Johnson.
Married with children, Brad Ferris completed a degree in business administration and managed a private health-care clinic prior to becoming a registered nurse. In his off hours, he operates a part-time business in the financial consulting field.
How he invests
Mr. Ferris started his portfolio more than 10 years ago, when he was in his early 20s. Shortly after, the bear market of 2008 came along and torpedoed his fledgling collection of stocks. But reading investment books and articles saved him. It provided the motivation to stay invested and to work extra hours to earn money so he could buy stocks when they were on sale.
His style is a blend of Warren Buffett's approach and dividend investing. First, as is the case with Mr. Buffett's investing vehicle, Berkshire Hathaway Inc., the chosen companies need to have enduring competitive advantages – as signalled by metrics such as wide profit margins and high returns on equity. Second, they need to have a history of raising dividends regularly.
The goal of his portfolio, which is held in a non-registered account, is to create "a growing, tax-efficient stream of income for early retirement." This stream is to be based on dividends from companies with, as mentioned above, sustainable competitive positions and that are likely to still be flourishing when Mr. Ferris is in his 50s and beyond.
His portfolio is pretty well settled on just more than two dozen companies. He is not so much concerned with uncovering new stocks as making sure dividends and new money are invested as soon as possible.
"If I have cash, I add to the … positions with the lowest portfolio allocations [thus maintaining a balanced portfolio]," he said. "Unless something has changed fundamentally, I keep strengthening my positions to increase my yearly dividend income."
"It would be [food retailer] Metro," he said. "It's not a sexy stock that attracts a lot of news, but they've been able to maintain margins impressively and have increased their dividend handsomely over the past 12 years."
The insurer "Manulife still haunts me from back in 2008. I … used historical performance as an indication of when to buy rather than examining the fundamentals of the business," which he has since sold.
Mr. Ferris recommends a focus on minimizing mistakes. If he could go back and fix his, he'd be a lot richer today. Avoid chasing performance and poor capital allocation – putting money into risky businesses without lasting competitive edges.