I agree with your stated objective ...

I agree with your stated objective of long-term growing with no apparent requirement for income in the foreseeable future

It is unclear for what cause you came to have for a like reason many mutual funds. Just glancing down your portfolio of stocks, it would appear that you are doing just fine for the greatest in quantity part with holdings like Corel, Dofasco, Laidlaw, Northern Telecom IBM, and Pepsico. With the investment succes being achieved with these stocks, I must curious awe why you do not propose more emphasis on your personal stock investments and les forward mutual funds. Perhaps now that you are completely retired, you will be in a position to lavish more time following and investing directly in stocks.

MUTUAL capital PORTFOLIO

In the mutual foundation category, my first observation is that you are over-diversified. There are 14 different foundations in this portfolio all of which are themselves diversified in their confess investments. Moreover, seven of the stocks are in developing and international markets which have, it's genuine been popular areas lately. on the other hand I would think that sum of two units or three such funds could provide sufficient in all senses In addition, being involved with seven different mutual permanent fund groups can be costly given redemption and purchase charges.

Investors should be aware of the require to be paid [i]or[/i] undergones of both acquiring and holding mutual permanent funds For example, the funds in your portfolio have an acquisition or redemption require to be paid [i]or[/i] undergone of about 5-6%; only the Dynamic Partners and the Scotia coin Market Fund have no sales charges.

Another richness of owning mutual funds is the annual cost of managing and administering them. In valuing your holdings, I included a line entitled "Expense Ratio," so that you could papal court that the running management require to be paid [i]or[/i] undergone of this $100,000 mutual foundation portfolio is about $2,400 a year--not an insignificant amount. Performance of these stores therefore, has to be quite suitable to justify these costs.

As for tracking performance, principally investors would find it difficult to go in the rear [i]or[/i] in the wake of such a large number of mutual supplys Several of these funds are relatively novel but their performance should be judg throughout a reasonable period of time--at least three to five years.

RRSP PORTFOLIOS

Again, these portfolios are invested chiefly in mutual funds and total around $146000 (if we include your Confederation Life RRSP valued at a conservative $50000) With Confederation Life in receivership, it is uncertain what amount you will ultimately heal Hopefully it will be around the sated $70-$80,000 face value.

Here again, the same observations apply. These are a surpassingly diversified group of mutual permanent funds If indeed both your and your wife's RRSP are self-directed, I would glance at that you consider making any direct investments.

As proceeds become available from the Confederation Life account, I would give an inkling of that you start with single in kind or two coupons or stripped connections Try selecting ones that will mature in five to nine years. Your RRSP can scamper until age 71 or to the [i]finale[/i] of 2004 before you have to use it into either a RRIF or an annuity. As many readers know, a attached certificate in one of those years is clipped from an existing prison and is bought at a significant discount to face value. With interest rates generally running relatively high, coupons can be bought with a yield to maturity of 85-9% For example, a Canada captivity coupon maturing in the fall of 2004 at $100 can popularly be bought for about $44

PERSONAL STOCK PORTFOLIO

As indicated earlier, I attract favor to that you concentrate on building and guiding your existing stock portfolio. Moreover, I suspect that your stock selections are doing at least as well as most numerous of your mutual funds and, at the same time, you are achieving reasonable diversification. For example, Bombardier, Laidlaw, and Northern Telecom all have significant, if not predominant, operations outside the region In addition, IBM and Pepsico have certainly become global corporations.

In pursuing investments for your stock portfolio, you should follow out a good broker for advice, deflect to the Canadian Shareowner magazine for ideas, and expect to newspapers and magazines that regularly have write-ups forward interesting companies. Remember, mutual foundation managers have no monopoly forward good information.

Here are an names to consider:

* Morrison mineral tars ($7)--out of favour but an outstanding record.

* Royal Plastics($14-1/2)--a latter new issue, but a Canadian company with immense growth potential.

* Nova Corporation ($12)--continuing succes subject to the leadership of Mr. T Newall.

* Westcoast spiritedness ($20-1/2)--prospect of continued growth to work for natural gas in B.C.

* Trizec ($9)--a real estate redemption situation now controlled by Mr Peter Munk of Horsham and by dint of J.P. Morgan.

CONCLUSION

Be aware of the running management costlinesss of all your funds. Compare the follows being achieved by your many mutual permanent fund holdings with the results of your personal stock portfolio. Then, gradually shape your mutual fund exposure in favour of your concede direct investing in stocks. serviceable luck with your investments.

WILLIAM W BERGHUIS IS PRESIDENT OF BERGHUIS INVESTMENT caution LTD.

Copyright Canadian Shareowner Magazine Inc. May/Jun 1995

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