Paul Cosgrove with his son Kevin and daughter Meghan.Courtesy of family
Paul Cosgrove, a retail investor in Victoria.
First Stock: Kevin SportsToys International Inc., maker of the Official NHL Wayne Gretzky’s Overtime Hockey Game
I bought this stock in the early 1980s. I was in my early 20s and open to a little bit of excitement. Not only did this stock have the Wayne Gretzky name behind it, but its board of directors included some of the people that started the Trivial Pursuit board game. I figured, with leadership like that, how could I lose? Also, I have an Irish background and like the name Kevin. I guess I’m a bit of a sentimental investor that way.
I also tend to stay loyal, sometimes to a fault. I bought into the initial hype – when the game was still a concept – and watched the value of my shares drop more than 70 per cent over the next few years. I learned later from the prospectus that royalties to “the Great One” and warrants to board members can easily eat into whatever value a common shareholder might start with. Nothing against Mr. Gretzky – that’s what he negotiated.
When I moved to British Columbia in 1989 to escape high house prices in Toronto, I sold some portfolio holdings, including that stock, to increase my down payment. I also didn’t want to borrow any more than I had to at the time with interest rates at around 14 per cent.
Before selling my shares in Kevin SportsToys, I decided to buy the game at a toy store in Victoria. I thought I might play it with a son or daughter, if I ever had one. The next day, the stock shot up 18 per cent. I then wondered what would have happened if I bought three games!
I sold the stock at a huge loss. In hindsight, it wasn’t a bad move because the value of my house in Victoria has gone from $149,000 to more than $1.5-million today.
Also, to prove there were no hard feelings, I ended up naming my son Kevin. I had that tabletop game until four years ago. I gave it to a friend who has two young boys.
[The company was taken over in 1992 by SLM International Inc., which has since been morphed into other companies, and the tabletop game is no longer manufactured.]
Lessons learned from the experience:
It has given me the incentive to read more about my investments and follow what people have to say about them on TV.
Today, I look at my stocks the way a baseball manager would look at a box score, like in the movie Moneyball. I have about 20 positions right now: Each one represents a “player” on my team, which is my portfolio. I buy names that I feel are at a discount and have a lot of upside potential. I don’t lose sleep on my investments. I accept going in that some will be losers.
Advice for other investors:
Know what you’re investing in. My biggest holding now is Canadian banks, which historically have done really well, on average. They’re not going to strikeout. They’re steady. But also allow a bit of your money to have a bit of fun.
As told to Brenda Bouw. This interview has been edited and condensed