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McElvaine Investment Management Ltd.
Tel: (250) 708 - 8345
Types of Accounts Managed
Provinces of Business
- British Columbia*
- New Brunswick
- Newfoundland and Labrador
- Nova Scotia
- Prince Edward Island
* indicates a physical location in this province
McElvaine Investment Management Ltd., a privately owned investment counseling firm, was formed in 1998. Tim McElvaine is the President of the firm, and is responsible for providing investment advice to The McElvaine Investment Trust. The McElvaine Investment Trust, established in 1996, is a prospectus mutual fund trust that is available for purchase by Canadian residents. Prior to and during the establishment of McElvaine Investment Managment Ltd., Tim held numerous positions at Cundill Investment Research Ltd., a portfolio management firm in British Columbia, including the positions of Chief Investment Officer, Portfolio Manager, Officer and Director. Tim has served as a Director of Glacier Media, Sun-Rype Products Ltd., Humpty Dumpty Snack Foods Inc. and Rainmaker Entertainment Inc.
Our investment philosophy is ”to make all the money on the purchase.” As investors, we believe one of the few things we can control is the price we are willing to pay. Therefore, when we’re selecting investments, we focus on what we’re getting and at what price we’re prepared to act. Our intention is to invest only where the difference between the value of the investment and the price we pay give us a margin of safety.The factors we consider when assessing investments can be summarized by our acronym, ”ABBA”, which represents the following:
A: Accident (what is our competitive advantage on the purchase): We deal in nightmares, not dreams. We’re looking for people who are selling for reasons other than price. Examples include: sectors, industries or regions people are avoiding; bad news such as dividend cut, downgrade, or unexpected poor results; and special situations such as spinoffs, emergence from bankruptcy, or rights issues.
B: Bird in Hand: We want to have a margin of safety based on our purchase price. We also consider what the stock may be worth in three years. Things we consider include: replacement value, liquidation value, private market value and sum of the parts value.
B: Brick HouseIn the story of the Three Little Pigs, the pig with the brick house survives the wolf. There will always be wolves in business and our job is to look for cheap brick houses. Some of the things we consider include balance sheet strength, free cash flow generation and capital requirements, as well as market share, competetive positioning, and relative cost of production.
A: Alignment of InterestsWe prefer to understand up front the motivation and interests of the Board and management. Some elements we consider include: stock ownership by directors and management, insider buying, management compensation program, and independence of Board.