Dale Roberts is the Chief Disrupter at Cut The Crap Investing blog. Dale worked as an Investment Funds Advisor for Tangerine. Dale’s mission is simple. Canadians pay some of the highest investment fees in the world. Those high fees will mostly (and greatly) damage returns.
Dale believes there are many wonderful low fee options available in Canada and helps Canadians discover low fee options via his blog cutthecrapinvesting.com We met at the Toronto Reference Library on January 27, 2020 (Monday @ 1100) for this interview. The duration of the interview was 25 minutes and 11 seconds. Thank you Teri Courchene for the e-introduction.
Urgen Kuyee: Hi Dale, why don’t you let my readers know a little bit about yourself? Which school did you go to and how did you get into personal finance?
Dale Roberts: Sure. My journey began at York University where I studied physical education. I was going to be a teacher like my dad. I have always been a writer at heart, even as a kid. So, I went to York and the very first term, I wrote an article for their local paper, York Excalibur. And few days later I go pick up the paper and they gave me the masthead. They took what I had put in my little article, I was covering a rock band if I remember correctly and I got the masthead of the newspaper. I was completely seduced and quickly that was the end of physical education. I didn’t really know what to do. I thought I wanted to be a journalist and I went and took a bunch of English courses and poetry.
I really should have gone to Ryerson or something but I didn’t know, right. At that point it was either journalism or advertising. Some friends talked me into advertising and they said it was a better career. You make more money wear better clothes, better life but I didn’t really know where to go. There were not a lot of ad schools back then but now they are everywhere and I have taught at ad schools at private colleges and Centennial.
Also, I have always been an investment junkie. I was probably one of the first ones in ETFs as you may know the oldest ETF in the world is XIU in the TSX 60. Maybe it went by a different name back then but it’s gone through a couple of hands or ownerships but again just a complete investment junkie.
My advertising career which was somewhat successful. I made some good money, won my Canadian International Awards and and got to travel around the North American parts of the world shooting commercials. It was really a wonderful career. But I was always talking investing with coworkers and friends who did not care. I had a 27 year career in advertising.
Eventually I talked my way into Tangerine as an investment advisor and trainer, I did five and a half years there.
Previous to Tangerine, I had worked my way to a wonderful scenario where I was freelancing; my part-time income from a single retainer for 15 hours a week was double the pay of the job I accepted at Tangerine. So, I more than doubled my hours and cut my pay in half. But I wanted to go talk to investors on a full time basis. It was not work. It was a paid hobby.
Five and a half years was enough. I needed another challenge, I wanted to help on a broader scale so I started Cut The Crap Investing in June of 2018.
UK: I didn’t know the oldest ETF in the world is XIU. Were you already an investment junkie when you were in advertising?
DR: Yes, as soon as I had some money to invest, the very stock first trade I made was while working at Taxi advertising with my partner, Helen. She was getting into stocks. I bought a stock in the morning and in the afternoon, it had doubled or tripled. I caught it on an absolute fluke of a news release. It skyrocketed. We are looking at each other laughing and we ask, ‘what do we do?’ Sell it? Okay. I sold it. The joke was I went home and bought my daughter a bike. But I then made lots of mistakes. It took me a long time to find my groove as an investor. Soon after I found ETFs but it took me a long time with mixing and matching different styles before I really found with simplicity and the power of simplicity.
UK: You are a former copywriter. You have close to 30 years of experience as a writer. What advice would you give to new, young writers entering the market or the real world?
DR: I would suggest do the proper schooling. I mean there are great schools now. They weren’t there when I started. Keep working on the portfolio of the book and talk to a lot of people. I got in because I had a lot of people helping me at every stage. You will be surprised at how generous people are in the investing space or blogging space, or in any space. I found in the advertising space I had folks who were willing to completely take me under their wing. I had one of the top art directors in the country who offered to art direct my portfolio. He and his writer partner taught me how to think and how to get in the business.
Like everything, copywriting is just hard work. It’s easier though if it does not feel like work. I feel fortunate in that I had a great career. I got to write television commercials, radio commercials, billboards, go shoot them, work with directors, producers, musicians and editors. What a great way to make a living. So, it’s not work right, but I just find such a consistency in life no matter what you choose and I have been through a few kinds of careers and that it’s hard work that works. That consistency is completely aligned. I have never seen anybody fluke out by not working hard and being successful. And working smart as you may know from the blogging space. You can’t just write, you can’t just produce, there are so many other factors involved. I find a complete correlation between input and output You get out what you put in.
UK: What is your writing practise like? Do you prefer to write in the morning, afternoon, night time? Will you have multiple rough drafts?
DR: That’s a great question. I am on a really bad sleep schedule mostly so I wake up way too early. Lots of coffee and I have a lot of energy then and I just start researching, start writing. I did it even when I was a freelance advertising copywriter. I would often be done a full day’s work by 10 a.m. and then I had my day free to do other stuff. Now I find I do a good amount of writing and research in the morning. I might even start honestly sometimes in like 4, 5 am and write to 9, 10, 11 am with a couple of quick breaks in between.
UK: Forgive me Dale. Do you mind if I pause you for a second?
UK: You start at 4 – 5am everyday?
DR: Every day, even weekends. I write 7 days a week and I love it. It’s not like if I wake up early in the morning, what am I going to do. It’s my hobby, it’s my passion. It’s not work for me. I am fascinated by it, I like helping people. I like all the interactions and people come from everywhere, every direction which is great. But I will go back to work during the day. I will put in another hour in here, a couple hours there. Sometimes, do a little bit at night but I am pretty fried from doing several hours in the morning.
And you want to keep poking social media too right. So you have to go back. We know they are there in the morning at 9. We know they are there around noon, we know they are there when they get off work at 4 or 5. Or they might go check in at 8pm at night again. We know those patterns when they are there so you want to go to connect with them.
UK: Thank you. Can you tell us more about your blog cutthecrapinvesting.com and what led you to start the blog?
DR: I wanted the freedom to write what I want to write, when I want to write it and how I want to write it. I didn’t want to have to be affected by compliance. When I was at Tangerine, all of my articles I was writing for Seeking Alpha had to go through compliance. I have been writing on Seeking Alpha for almost 10 years and I have more than 9000 followers which is great and it helps feed readership to Cut The Crap Investing which is great.
UK: By followers, you mean subscribers, right?
DR: No, they are followers. A lot of people on Seeking Alpha do the subscriber trying to earn money from it. I get paid a tiny bit for articles but I write there so that it’s for free for people coming in. So, I don’t really like that whole subscriber thing. I am good at not making money of all this (Laughs). At Tangerine or if I went to work at another place, it goes through compliance. The lawyers were telling you, you can’t say this, can’t do that, can’t write on that. Again, I am a writer at heart so it was just too constrictive. I needed to break free. And not that it wasn’t fascinating, I loved the job every day. It was not work at all at Tangerine, absolutely loved it. There was always a smile on my face, loved clients, joking around, making it fun and to be able to help so many people. I became a trainer which was really nice as well. Sometimes I go back and do some sessions but I just needed the freedom to able to write on everything from stocks to ETFs. And I just wanted to learn more. It was a great place to work but it had its boundaries.
Freedom was essential for me and to do everything like to be here with you today, to open the stock markets on Tuesday with BMO, to go teach with Ellen and Teri at U of T. To be a panelist at the Inside ETFs conference. To be an ETF panelist for MoneySense. I am also going to do my own investment club one day. I want to start doing more lunch-and-learns, more public speaking in general.
UK: You mentioned you used to train advisors at Tangerine. How could you tell an advisor would be successful or not? What were some of the traits or patterns you would see when you trained them.
DR: Passion would be one and honesty as well. Another one is they are not looking to sell, instead they are there to help. In some folks you could see coming in that they had too much ambition that they wanted to move on or up too quick, to move to an Invesco or Vanguard or BlackRock or an active manager. They wanted to get out real quick. They still might be very good while they are there but they were easy to spot. I would say to them be a little more patient than you think you need to be because it looks great on your resume to hang around a while. There was more to learn than they suspected, as well.
Folks that I have seen really do well, actually put in like a couple years. One of our top guys was so smart, he came in, we had no idea that he was a CFA and had marks that were incredible. He passed on his first attempt. He hung out for a few years, doing the job with energy. He could have been gone early but he stayed. Eventually, somebody grabbed him and put him in a very good position in the ETF world. But I saw him being patient and then leapfrogging above the people who left early. It doesn’t look good on your resume when you stay somewhere for 6 months or sometimes even just a year.
Also, personality-wise, you could tell some people were not suited to offer honest advice. It’s not what everybody is wired for.
UK: I recall someone saying, don’t tell us what to invest in, tell us or show us what is in your portfolio. Do you mind sharing how do you invest your money and what’s in your portfolio today?
DR: Yeah, I don’t mind. I have put it on mostly on Seeking Alpha because that’s more of a stock world if you want to do some individual stock stuff. For US, you can buy an index fund of course, but what I am too is a skimmer. You can go skim a bunch and remove the MER completely. For US, I had done much research on this. I just simply bought 15 of the largest cap companies from the dividend achievers index in the US. I always said I would probably buy 20 or 25 to be diversified enough but I also had 3 picks. I have Apple which is just a brand pick because I am an ad guy. I know the spirit of the brand and the loyalty of consumers.
UK: I agree. My sister recently bought AirPods for my mom, cost her over $200. Apple products never go one sale and we keep buying it.
DR: Absolutely and they have so much cash. As I hold up my iPhone, if they find a company or technology that’s threatening, Apple can just go and buy them because they simply have so much cash. Blackrock is the second pick. Blackrock owns iShares and they are the biggest sellers of ETFs. They are set to profit even more. They have other business lines as well but I thought it is a very simple and obvious trend, great brand. The massive move from mutual funds to ETFs is what we call an undeniable trend. Now, there is competition and there is a race to the bottom on fees so it does not mean it is going to work. It is matching the market returns but the prospects are good. Then, I invest with Warren Buffett in Berkshire Hathaway. I just had to own it, become his business partner.
UK: Class A or Class B shares?
DR: B shares (Laughs). I wish I had A shares. This one was more of a defensive pick because his outperformance is exaggerated in market corrections so it’s in one of my wife’s accounts. The risk there of course is that Mr. Buffett passes away and might have to pass it down to, like 98 year old Charlie Munger, young guy (Laughs). Anyways, 18 picks in the US.
In Canada, I hold 7 big wide moat big dividend paying companies. I mean people can slap me and say you should be more diversified but that’s sort of my journey. I had been in and out of these stocks. I was doing indexing plus a few individual stocks and then went back to pure indexing. I drifted back and forth.
I realized that if I had simply held on to my banks, my telecoms, my pipelines, there are other oligopolies too. I would have had better performance. They did better than the index. I like the income, I like the big growing dividends. Again, I write on my blog that I don’t expose my wife’s accounts to that concentration risk – she holds Vanguard VDY for Canadian equity. And I realize that my portfolio is very concentrated but there is that wide moat. That’s where I make a bet. I mean the Canadian banks have to survive, for the telecoms, there is no competition.
UK: I mean if the banks go down, I think everything goes down, right.
DR: Yes, everything goes down. They are protected. They are oligopolies, they are protected by a lot of government agencies if you will. Same with the telecoms as much as we cry for competition, not going to happen in my opinion. Pipelines are there, built, there is no competition, essentially. You are not going to build a pipeline beside one of Enbridge’s. Those are businesses built on stable contracts. Those pipelines are full, and booked.
We also hold Canadian and US bonds in the portfolios in range of 20 to 25% bonds.
UK: Thank you Dale. Where can people find you?
DR: You can hit cutthecrapinvesting.com. I am also on Seeking Alpha. Or just Google Dale Roberts and investing. I am also on twitter where I spend too much time. You can tweet at me @67Dodge. I am also on LinkedIn.
UK: Thanks Dale.
DR: Thank you, Urgen.
This interview has been edited and condensed.