diversification

Here are three common mistakes many investors make when selecting Canadian stock picks. All three can seriously hinder — or eliminate — your portfolio’s long-term profit potential. 1. Buying low-quality investments: Most of the bad deals in Canadian stock picks exhibit the usual tip-offs. For example, many lack a history of earnings or dividends. They may also spend way too much time publicizing themselves, and too little time building their businesses. To increase your stock market returns, we feel you should invest mainly in high-quality, dividend-paying companies. We also feel you should diversify by spreading your money out across the five main economic sectors (Resources & Commodities, Finance, Manufacturing & Industry, Utilities and Consumer)....

CEDAR FAIR L.P., $14.11, New York symbol FUN, owns 11 amusement parks, six outdoor water parks, one indoor water park and five hotels, mostly in the midwestern and northeastern U.S. The stock rose 17% this week. That’s because Cedar Fair has cancelled a friendly, $11.50-a-unit takeover offer from private-investment firm Apollo Global Management. Many unitholders thought that price was too low, so this move raises the possibility of a higher bid. Cedar Fair will pay Apollo $6.5 million in cancellation fees. To put this figure in context, Cedar Fair earned $35.4 million, or $0.63 a unit, in 2009....

Our Successful Investor business model has two parts. We publish investment advice, and we manage investor portfolios. This two-business model has advantages for our subscribers. The stock market investing problems we encounter as money managers, and the solutions we come up with, help us give our readers unbiased, practical advice. This serves as a counterweight to advice you may encounter elsewhere that is based on misapplied theory, or tainted by conflicts of interest. ...

Exchange-traded funds (ETFs) have gained popularity in recent years, mainly because many ETFs offer very low management fees. In addition to low fees, the best ETFs offer well-diversified, highly tax-efficient portfolios. However, quality varies. The investment industry has created all sorts of ETFs. All too many exist to tap into popular, but risky, themes and fads, so you need to be highly selective with your ETF holdings. Here are five foreign ETFs we like:...

Noranda Income Fund, $2.96, symbol NIF.UN on Toronto (Units outstanding: 37.5 million; Market cap: $111.0 million), was created in 2002 to buy the CEZ processing facility and some assets that belonged to Noranda Inc. Falconbridge bought Noranda in 2005. Switzerland-based Xstrata Plc then bought Falconbridge. Xstrata Canada holds a 25% interest in Noranda Income Fund. The fund first sold units to the public for $10 each, and began trading on Toronto in May 2002. The fund’s CEZ processing facility is located in Salaberry-de-Valleyfield, Quebec. It’s the second-largest zinc-processing facility in North America, and the largest in eastern North America, where the majority of its customers are located....

Some U.S. bank stocks have reported improved profits lately. And many banks have repaid some or all of the loans they received under the U.S. government’s Troubled Asset Relief Program (TARP) in 2008. That frees these bank stocks from government control, and improves their long-term prospects. However, the U.S. banking sector remains highly volatile. As well, the industry could face greater regulation and higher costs if the Obama administration moves ahead with its reform plans. For example, Senate Banking Chairman Christopher Dodd recently released a bill that proposes to tax the largest bank stocks and financial institutions. The proceeds would be used to support a $50-billion U.S. fund aimed at dealing with failing banks and financial firms in the future....

We take many different factors into account before we award a stock one of our Successful Investor Ratings (Highest Quality, Above Average, Average and Extra Risk). You’ll find our ratings displayed next to every stock we recommend in our newsletters — including our flagship publication, The Successful Investor. They’re designed to help you quickly and easily identify companies that have the ability to survive a business setback and go on to greater success when conditions improve. Here are three factors we take into consideration before awarding a rating. We think they can help you improve your returns and lower your risk when you invest in the stock market:...

Our Successful Investor Stock Picker Fund is one of four “pooled funds” we offer as part of our Successful Investor Wealth Management service. The fund takes its name from our Stock Pickers Digest newsletter, which focuses on investments that would be suitable for your aggressive portfolio. Our pooled funds operate like traditional mutual funds. They give us a way to offer investment management to investors with smaller portfolios. They also give investors with larger portfolios a way of investing in specialized areas of the market. ...

DELPHI ENERGY $3.18 (Toronto symbol DEE; SI Rating: Speculative) (403-265-6171; www.delphienergy.ca; Shares outstanding: 101.2 million; Market cap: $321.8 million; No dividends paid) explores for oil and gas in Alberta and B.C. Natural gas makes up 83% of its daily output. In the three months ended September 30, 2009, Delphi’s average daily output rose 5.6%, to 6,773 barrels of oil equivalent (this measurement includes natural gas) from 6,409 barrels. Despite the higher production, Delphi’s cash flow per share fell 33.3%, to $0.16 from $0.24 a year earlier. That’s because of lower oil and natural-gas prices. Delphi now holds 172,209 acres of undeveloped land. That’s up 37.3% from 125,359 acres in 2008. That gives it lots of drilling targets to increase output....

In a recent TSI Network poll, we asked site visitors whether if trust the advice they get from their stock broker. Aside from a yes or no option, we gave visitors a third choice: “I trade online through a discount broker.” Seventy-five percent of the poll’s respondents selected this answer. You can see the full results of this poll, and a full archive of previous polls, on TSI Network. Just click the “Poll Archive” button below the main banner on the site’s home page. ...