Peter Leacock - Investment philosophy

How can we put the odds of investment success in our favour? Here are my investment beliefs after more than 30 years in the capital markets:

Simple is preferable to complex. I manage just one portfolio strategy, rather than 3 or 5 or 10.
Ideally limit the number of portfolio positions to 30 names - that is sufficient diversification.
Today's extremely low interest rate environment means that yields on government and investment grade bonds are unlikely to keep pace with inflation, causing a potential loss of real purchasing power.
Don't invest money today that you will need for a major capital outlay (down payment for a home, purchasing a new car, etc.) within the next two years.
Stick to consistently profitable businesses.
Paying a low price for earnings historically has provided much better returns than paying a high price for earnings.
Small companies can have much higher growth potential.
As Warren Buffett and Charlie Munger have said, it is better to pay a fair price for a great company than a bargain price for a poor one.
Be patient - the market does not care about your schedule.
Often the best thing to do when invested in great companies is leave them alone.
A lot of value in the future resides in out of favour and unpopular stocks today.
For the long-term investor, it is better to be an optimist.

[music]

[On screen: Overlaying a softly lit room with a painting in the background, the image shows "Peter Leacock, Portfolio Manager" in white lettering on a transparent foreground. To the right, the CIBC Private Wealth Management logo in red and gold is displayed. ]

[On screen: Peter Leacock is seated at a conference table in a well-lit office. He has white hair, wears glasses, and is dressed in a dark suit with a light grey tie and white shirt. To his right, there's a large potted plant, and on the wall behind him is a colorful landscape painting. A notepad and pen are on the table in front of him. ]

PETER LEACOCK: Hello, my name is Peter Leacock, and I'm a portfolio manager and investment advisor at CIBC Wood Gundy. I manage a portfolio strategy for my clients with the objective of keeping the probability of success in our favor by adhering to the following 10 beliefs. Number one, simple is better than complex. Number two, corrections are inevitable. It can take two years or even longer to be made whole after a loss. Therefore, it's not a good idea to invest money in the portfolio that you'll need within two years for major outlays.

Number three, stick to consistently profitable businesses. Number four, paying a low price for earnings historically has provided a much better return than has paying a high price for earnings. Number five, small companies can have much higher growth potential. Number six, as Warren Buffett's partner, Charlie Munger, has said, "It's better to pay a fair price for a great company than a bargain price for a poor one." Number seven, be patient. The market doesn't care about our schedule.

Number eight, often the best thing to do when invested in good companies is to leave them alone. Number nine, a lot of value in the future can reside in out of favor and unpopular stocks today. Number 10, when it comes to investing, it's better to be an optimist. If you would like more information on my portfolio strategy, please let me know.

[music]

[Text on screen: Peter Leacock is a First Vice-President, and Senior Portfolio Manager at CIBC Wood Gundy in Vancouver, BC. The views expressed herein do not necessarily reflect those of CIBC World Markets Inc.

This information, including any opinion, is based on various sources believed to be reliable, but its accuracy cannot be guaranteed and is subject to change.

Past performance is not a guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance of any of the strategies outlined in this report.

If you are currently a CIBC Wood Gundy Client, please contact your Investment Advisor.

CIBC Private Wealth Management consists of services provided by CIBC and certain of its subsidiaries, including CIBC Wood Gundy, a division of CIBC World Markets Inc. CIBC Private Wealth Management is a registered trademark of CIBC, used under license. “Wood Gundy” is a registered trademark of CIBC World Markets Inc. ]

[music]

[On screen: Overlaying a softly lit room with a painting in the background, the image shows "Peter Leacock, Portfolio Manager" in white lettering on a transparent foreground. To the right, the CIBC Private Wealth Management logo in red and gold is displayed. ]

[On screen: Peter Leacock is seated at a conference table in a well-lit office. He has white hair, wears glasses, and is dressed in a dark suit with a light grey tie and white shirt. To his right, there's a large potted plant, and on the wall behind him is a colorful landscape painting. A notepad and pen are on the table in front of him. ]

PETER LEACOCK: Hello, my name is Peter Leacock, and I'm a portfolio manager and investment advisor at CIBC Wood Gundy. I manage a portfolio strategy for my clients with the objective of keeping the probability of success in our favor by adhering to the following 10 beliefs. Number one, simple is better than complex. Number two, corrections are inevitable. It can take two years or even longer to be made whole after a loss. Therefore, it's not a good idea to invest money in the portfolio that you'll need within two years for major outlays.

Number three, stick to consistently profitable businesses. Number four, paying a low price for earnings historically has provided a much better return than has paying a high price for earnings. Number five, small companies can have much higher growth potential. Number six, as Warren Buffett's partner, Charlie Munger, has said, "It's better to pay a fair price for a great company than a bargain price for a poor one." Number seven, be patient. The market doesn't care about our schedule.

Number eight, often the best thing to do when invested in good companies is to leave them alone. Number nine, a lot of value in the future can reside in out of favor and unpopular stocks today. Number 10, when it comes to investing, it's better to be an optimist. If you would like more information on my portfolio strategy, please let me know.

[music]

[Text on screen: Peter Leacock is a First Vice-President, and Senior Portfolio Manager at CIBC Wood Gundy in Vancouver, BC. The views expressed herein do not necessarily reflect those of CIBC World Markets Inc.

This information, including any opinion, is based on various sources believed to be reliable, but its accuracy cannot be guaranteed and is subject to change.

Past performance is not a guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance of any of the strategies outlined in this report.

If you are currently a CIBC Wood Gundy Client, please contact your Investment Advisor.

CIBC Private Wealth Management consists of services provided by CIBC and certain of its subsidiaries, including CIBC Wood Gundy, a division of CIBC World Markets Inc. CIBC Private Wealth Management is a registered trademark of CIBC, used under license. “Wood Gundy” is a registered trademark of CIBC World Markets Inc. ]

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