Interpreting the big picture

Laszlo Erdosy, 52

Profession: Professional engineer

Portfolio: TD Bank, TransCanada, Fairfax Financial, Nokia, PetroChina, CN, RIM, and Suncor Energy. Funds: Claymore Precious Metals, Sentry Select, Mackenzie Universal Canadian Resource, Fidelity True North, and AGF Emerging Markets.

His Approach

Mr. Erdosy likes to think big picture. He sees the U.S. dollar as heading for trouble thanks to the country's debt load. "There's no inflation if you factor out oil and food and gas, but who doesn't drive or eat?" As he sees it, the U.S. will eventually have to pay it all back to China, "and the way to deal with the problem is to inflate the currency."

His Focus

Mr. Erdosy has recently shifted 15 per cent of his portfolio into gold through the Claymore Precious Metals Fund, and Sentry Select. "Gold is priced in U.S. dollars, and there is an inverse relationship between the dollar and gold." He also has some money in resources, through Mackenzie Universal Resource fund, Fidelity True North fund, and AGF Emerging Markets fund.

His Broker's Role

Mr. Erdosy says he has always got good value from his broker. He also says there's a cost efficiency, since his broker's client base allows her to shell out for expensive independent research.

Why he uses Mutual Funds

"What I'm looking for is to establish income, because I'm nearing the age where I have to start thinking of my retirement." He also notes that selecting stocks is a little more risky, and "with funds at least you have a little diversity."

He also says he doesn't' mind paying for expertise. For instance, his first resource fund was AGF Canadian Resources, but he switched to Mackenzie Universal Canadian Resource Fund, after hearing manager Fred Sturm speak. "l liked his presentation and theories, and it's panned out."

Why He's Big on Dividends

"They are your best friend," he says. "If a stock is paying dividends and you can reinvest them in the company, you don't pay commissions."

Best Move

Mr. Erdosy especially likes TD Bank. He has all his dividends reinvested, and in doing so he gets a discount of 1.5 per cent below the closing price.

Worst Move

In the eighties, Mr. Erdosy bought Bovar Inc., an oil service company. "The company overextended itself and kept going down and down and down. I should have exited much earlier."

Want to share your strategies?

E-mail tony.martin@sympatico.ca