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me & my money

Ben Rabidoux, 30

Occupation: College instructor

The portfolio

Exchange traded funds (ETFs) including iShares S&P/TSX 60 Index, iShares MSCI Emerging Markets Index, iShares DEX Short Term Bond Index, and stocks including Calian Technologies Ltd., Bennett Environmental Inc., FP Newspapers Inc., Goldcorp Inc., and Intel Corp.

The investor

Ben Rabidoux teaches psychology and ethics at Georgian College in Ontario. Having read "a ton of books" on investing, the subject has become a passion for him. Indeed, he has completed the Canadian Securities Course and Financial Planning Course, and intends to begin teaching financial planning next year. He enjoys sharing his perspectives on his blog at TheEconomicAnalyst.com.

How he invests

Mr. Rabidoux blends passive and active investing. The core of his portfolio is made up of broad-based ETFs and rest is made up of stocks, or sector ETFs, that he feels can outperform the indexes.

When it comes to buying stocks and sector ETFs, he has a value orientation. He looks for price-earning ratios less than those of industry peers, and in the single digits. "I also prefer stocks that are trading at less than book value per share and have good liquidity," he adds.

Buying stocks at bargain prices often requires courage to go against the crowd. For example, Mr. Rabidoux reports he "picked up the Claymore Japan ETF after the brutal earthquake and tsunami caused many Japanese stocks to sell off."

His other stock screening criteria include:

-little debt and strong cash flow

-debt-asset ratio under 0.5

-current ratio (current assets/current liabilities) above 2

-dividends backed by low payout ratios

Best move

"It was holding quite a bit of cash when the market peaked in 2008, and then using the cash, as well as a line of credit, to pick up bargains….Looking back now, these were no-brainers, but at the time I had to swallow hard and dive in amid the panic and turmoil. Not a single investment made during the depths of that panic has returned less than 100 per cent …."

Worst move

"I was convinced that natural gas was poised to rebound in 2010. I bought some call options on some stocks only to see the value of the options plummet to zero. I'm still bullish but now own natural gas ETFs instead."

Advice

"Don't follow the crowds and don't chase momentum. Choose an asset allocation that you are comfortable with and maintain it. Stay diversified and watch expenses."

Special to The Globe and Mail

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