This document summarizes a presentation given by Iain Butler on investing. It discusses that Motley Fool Canada provides stock recommendations to members and currently has 23 active recommendations. It also discusses different approaches to investing, emphasizing that timing the market is difficult but that time in the market provides an advantage. It argues investors should focus on core investment principles, diversify their portfolio, and avoid overtrading or trying to time the market in order to be successful long-term investors.

1. Your Slow Mover Advantage Over Bay Street
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Money Show 2014 – Toronto
By: Iain Butler, CFA

2. • Fool.ca started at the beginning of 2013
• Active run of daily company related commentary
• Stock Advisor Canada launched October 2013
• Members only advisory service
• 1 Canadian and 1 U.S. recommendation per
month
• 23 active recommendations
• Just getting started!
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Motley Fool Canada

3. April 7, 2014 – CNBC – Dennis Gartman of the famed
“Gartman Letter” announces he’s pared equity exposure
from an average (?) of 100% to close to zero
April 21, 2014 – CNBC – Dennis Gartman – announces that
he’s re-entered the market and has become “pleasantly
long” stocks
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“Advice”

4. Overnight weakness following The World Bank
downgrade, China's flip-flop on CNY and failed auction,
Cantor's 'compromise-shattering' loss, appeared to be
stabilized by a levitating USDJPY but when the budget
deficit hit (as expected) it appears the market was
hoping for a bigger deficit (and thus more to monetize
and moar QE). Stock are diving lower with Trannies
worst along with the Russell 2000 -1%. CNBC is already
discussing if this is the pullback to buy for the next leg
higher in stocks as money on the sidelines floods in...
- Zero Hedge 6/11/2014
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“Stocks slide into the red for the week”

5. “Timing the market is a fool’s game, whereas time in
the market will be your greatest natural advantage.” –
Nick Murray
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A More Foolish Approach

6. “When you first start to study a field, it
seems like you have to memorize a zillion
things. You don't. What you need is to
identify the core principles -- generally 3 to
12 of them -- that govern the field. The
million things you thought you had to
memorize are simply various combinations
of the core principles.”
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John Reed:

7. • Unsuccessfully
• Long term (varying degrees to success)
• Short term, successful due to luck
• Short-term, successful due to manipulation/fraud
That's the complete list. Numbers 3 and 4 eventually
become number 1.
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Four Ways to Invest……

8.  Time is the most important variable in investing, but
the one we have the least respect for. Buffett: "I think
slowness turns off more people than anything else.“
 Of Warren Buffett’s $60 billion net worth, $59.7
billion came after his 50th birthday, $57 billion came
after his 60th.
 Most investors’ definition of long term is the time
between now and the next bear market.
 Real estate feels like the best investment only
because people hold it for the longest time.
 Time is your last remaining edge on Bay Street.
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11. • Thinking we can predict leads to overconfidence.
Overconfidence leads to misery.
• Knowing you can’t predict automatically forces you to plan for
contingencies. It forces diversification.
• Investing works best with a wide margin of error. (This is true
for most things in life).
• Graham: “The purpose of the margin of safety is to render the
forecast unnecessary.”
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Life without predictions

12. “Do nothing" are the two most powerful
words in investing.
• “The big money is not in the buying or the selling, but in the
sitting.” -- Jesse Livermore
• Anyone who bought an index fund 20 years ago and checked
for first time this morning can call themselves one of the best
investors in the world.
• Sell your house in May and buy it back in October? Insane. But
people do the same with stocks.
• Doing nothing isn’t an option for pros. So advisors trade,
shuffle, rotate, panic, sell in May and go away, and generally
make idiots of themselves. 12

13. Try doing less.
• Investors think dollar-cost averaging is boring without realizing that
the purpose of investing isn't to minimize boredom; it's to maximize
returns.
• Effort in investing increases confidence more than ability.
• Barber and Odean: “Investors who trade the most realize, by far, the
worst performance.”
• “All men's miseries derive from not being able to sit in a quiet room
alone." - Blaise Pascal
• The best investors in the world have more of an edge in psychology
than in finance. 13

14. • Don’t overthink.
• Don’t try to tactically time the market – dollar cost
average or simply wait for the fat pitches to roll-in.
• Assume the market return will be an annualized 6-8% over
long periods of time. Ignore year to year.
• Use the rule of thumb that the worse the market has
done over the past 10 years, the better it will do over the
next ten.
• Rebalance your mix of stocks and bonds every few years.
• Prefer companies that reward shareholders with
dividends and buybacks.
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The Fool’s version of a stock tip

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Questions?
ibutler@fool.com