Jay Harrison, 65
Occupation
retired
The portfolio
Investment funds such as Salida Strategic Growth Fund, Front Street Canadian Energy Fund and RBC Global Resource Fund.
The investor
Retiree Jay Harrison lives with his wife of 42 years on the shores of a lake at the end of a three-kilometre private road. Every now and then, the couple leave their secluded setting to do some travelling - like the trip they took recently to the Smithsonian.
Investing approach
With plenty of time and risk capital at his disposal, Mr. Harrison's investing has become a consuming passion. He is excited about a trading system that he says has worked very well for him.
His approach, in essence, involves buying mostly no-load investment funds with strong recent gains and holding them until the momentum fades. As he reports: "I've been using an investment fund momentum strategy for about 10 years that has worked extremely well."
First, he scans GlobeInvestor Gold to compile a list of mostly four- and five-star equity funds with at least a five-year track record. Then, using a spreadsheet, he ranks the funds in order of the "Short Term Total" - which is the sum of one-, three- and six-month returns (or the equivalent of a weighted six-month return that gives relatively more weight to the first three months).
Each month he updates his list, adding or deleting as necessary. He'll sell a holding if it has been in the bottom third of his performance rankings two months in a row. The objective is to own "the best of the best."
The bear market of 2008 and 2009 taught him a new rule, which he calls the "There is no momentum, stupid" rule. If the "Short Term Total" falls below 70, he'll sell and go into cash, especially if the market or sector is correcting.
Best move
He plowed $224,000 into Front Street Special Opportunities Fund in March of 2009 and sold a year later for a gain of 44.9 per cent.
Worst move
He lost $20,900 on a nine-day trade in Horizons BetaPro Nymex Natural Gas Bull Plus ETF.
Advice
"I don't tend to diversify over a wide range. I'll pick categories that have momentum and invest in those only. A few months ago I was about 40-per-cent precious metals, 20 per cent in other resources and 40 per cent in emerging markets."
Special to The Globe and Mail
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