George Frazer’s investment philosophy

December 01, 2006

George Frazer often describes his style as “something akin to watching paint dry.”

He prefers to make long-term secular bets, trading in and out of securities rarely when one compares favourably to another for income. He describes an investment a few years ago when Nortel Networks Corp. was trading at $100 and on its way upward but yielding only about 11¢ per share. He then compared Nortel with TransCanada Pipelines Ltd.’s stock, which was trading at $33 per share and had recently trimmed its dividend to 85¢ from $1. So, did he trade the two?

Frazer remembers 50 years ago, when every discretionary item he bought needed to be plugged into a wall

“Right on, baby!” responds Frazer enthusiastically. “I don’t know where Nortel went. All I knew was that it wasn’t worth holding. I don’t care about the stock price, except when I get a good yield out of it and I want to own the company forever.”

Phone companies, banks, pipelines, utilities — these are Frazer’s staples, and he says he would love to be around another 50 to 100 years to see where they take the fund. He remembers 50 years ago, when every discretionary item he bought needed to be plugged into a wall.

He has never forgotten the excitement of that time. “The demand on electricity and energy will be huge,” he remembers thinking. “Look at the things that will produce electricity, and the utilities that will give you access to the investment.”