Trust Intelligence

Welcome to Trust Intelligence.

My name is Alan Ross.
I use the name “agrossfarm” when posting on the web.

I founded Trust Intelligence about 5 years ago to help people learn how to invest more intelligently and therefore more profitably. Originally, the emphasis was on Canadian Trusts, mostly Oil and Gas Trusts. The website built up a substantial user base in the first year or so and the demands on my time increased, so much so that we abandoned the old website because it couldn’t handle the traffic and archive of posts. We moved to the new site (http://www.trustintelligence.com/) and changed the discussion board (http://www.trustintelligence.com/forum/index.php) software as a result.

I started out with the goal of helping people understand the petroleum business and how to evaluate the different trusts but, more and more, people wanted me to pick stocks and give advice. As a result, I decided to start the Premium Service as an addition to the still-free part of Trust Intelligence.

Trust Intelligence has always had a focus on total return, but whenever possible, including a significant dividend yield, so that when growth slowed, the dividend yield still provided some income. Our goal is to make money, not to beat a benchmark, by choosing investments that provide potential rewards that overcompensate for the risks incurred.  Trust Intelligence exists to help you evaluate potential investments so you can find stocks that fit you investment goals and risk tolerance and that give you that “edge”; something that reduces risk or makes an opportunity more lucrative.

In 2006, when the Canadian Government passed a law that will put punitive taxes on Trusts in 2011, we shifted focus. As a result of the new law, a number of Trusts were put up for sale, and we made lots of money on some of those deals, like buyout of GolfTown Income Fund. As China grew and increased its imports of raw materials we branched out into mining investments and fast growing petroleum companies, even if they were not trusts. We had some big winners in the new petroleum shale plays like Chesapeake, Cubic and quite a few others, before prices started to tumble. With few exceptions, we did not hold the miners and oil stocks through the decline. During the second half of 2008, we took profits and did more selling than buying. As the recession became more obvious, the focus of the Premium Service shifted to accumulating recession-resistant beaten down stocks that pay 10 to 30% returns.

Just as successful investing is a non-linear progression from one opportunity to another, my progression to running an investment website was nothing I originally planned on. After college, I enrolled as a Graduate Student in McGill’s Psychology Department in 1969. From the start, I did my research in the Allan Memorial Institute’s Neuropsychology Lab, specializing in the physiological aspects of motivation and emotion. At the same time, I started tracking penny mines and oils looking for patterns and a way to supplement the meager stipend I received as a Teaching & Research Assistant and from my grant from the Medical Research Council of Canada. I started to buy and sell penny stocks, trying to scalp a short-term 5% net profit. Given the exorbitant 2% to 3% commission in effect at that time, it was a challenging task. Luckily, there were no Canadian capital gains taxes at the time, so for a while, I was making twice as much money trading than from Psychology.

As a young naïve investor, it was very exciting to calculate how much money I’d have if I could only continue to make a 5% weekly return! It was obvious that I’d be a millionaire in a few years, and that meant something back in the days when rent was $125 each month and you could fill your gas tank for less than $10.

As most daytraders eventually learned (after they had the technology to make day-trading available to the masses), bull markets and consistent profits don’t last forever. Certainly, 5% weekly profits on mining shares selling for 3 to 50 cents, are not easy to sustain. The inevitable result was getting stuck holding a bunch of devalued and worthless paper. This was my first hard lesson in investing and it didn’t take long to learn it. The easy lesson was that investing wisely could provide a lucrative income and that income provides the freedom to pursue other goals. I certainly liked the extra income so I decided to get serious and learn how to invest more wisely and avoid the pitfalls. Luckily for me, the McGill Business School’s Bronfman Library was located across the street from my Lab, up on Mt. Royal. In order to learn more about investing, I set out to read every book they had on the subject.

In the early 1970s Canadian oil companies like Ranger and Scurry Rainbow were busy exploring the North Sea and the McKenzie Delta in Northern Canada. Big new discoveries were being made by relatively small companies, so I started trading oil stocks, buying in anticipation of announcement of drilling results. I also started doing a little merger and acquisition arbitrage, something that was not a common pursuit in Canada, at the time. My investing was a hobby that brought in a bit of extra money because my focus was still my education and career in Psychology. In 1973, I became a Psychology Prof at Dawson College in Montreal and switched from Neuropsychology of  Motivation to a focus on Applied “normal” Psychology. I started teaching courses in Industrial Psychology and doing outside consulting work, developing training programs, advertising, compensation systems and personnel selection instruments. In late '76, I started investing in real estate with a focus on renovating, still dabbling in the stock market in what little was left of my free time.

In the early 1990s, I developed my own personal econometric model to see when I could comfortably retire. Being a Professor had become somewhat routine and we were being put under increased pressure to pass more students, with no minimum learning requirement. I was getting more and more interested in my extracurricular activities, seeing less excitement in my academic career, even though it provided a decent paycheck and lots of free time. At the time, I had a modest net worth, but I calculated that I could quit my job and live off my investment returns if my living expenses were not extravagant and I could earn a return that comfortably exceeded the historical inflation rate. Long story short, after waiting for a disastrous real estate market to improve, I was able to sell my remaining building in downtown Montreal and retire to a low-impact lifestyle at our farm at yearend 1996, when I was 49.

I started spending more time investing, increasingly using my research abilities to find ways to make money through thick and thin. I started posting a lot on some Yahoo boards and got heavily into risk arbitrage. The buyout of PLAT by CA made me launch a private Yahoo board specializing in M&A. I then came across a group called Investor’s Alliance and got active in that, where I met Peter von Pinnon, who is an IT professional, a prudent and successful investor and handles webmaster duties for the Trust Intelligence website.

In 2002 I became convinced that the worldwide petroleum situation was going to create a significant change in the way the world worked and that there was an investment opportunity of historic proportions before us. Once again I started to focus on the oils and specialized in the Trusts, since I still needed to earn income to pay my living expenses. With the help of my wife Geri, who had extensive experience as a CFO in the construction, textile and advertising business, I applied my research skills and did quite well. Meanwhile, having been really disappointed by what passed for Trust sector research, I thought I could help people learn how to analyze and understand the trusts so that they could reap the benefits that I was enjoying. Peter volunteered to set up the Trust Intelligence website and I did my best to help people learn how to direct their investments (as opposed to telling them what to do). As we got more and more site members, it took up more of my time. I decided that I should either quit or start to charge, and so the Premium Service was born only a couple of months before the Halloween Massacre in 2006, when the imposition of an arbitrary, counterproductive, and capricious tax decimated investment values and impoverished thousands of people.

Government actions and inactions frequently provide both opportunities and punishment for investors. Whatever the developments, my goal remains. I want to earn money in the market…
enough to pay my bills,
enough to compensate for inflation’s effect on my capital, and hopefully
enough to increase my net worth.

I have multiplied my investment capital hundreds of percent since I’ve retired. I learned that, whenever it seemed to be easy, it was about to get very difficult and stressful. Buy and hold strategies might have been useful when the world ran at Pony Express speeds, but in the computer age, things can change very quickly. The most admired company can be in disgrace and bankrupt in a month. It is not an understatement that continued vigilance and study is part of the price we investors must pay to maintain the purchasing power of our net worth. Experience has taught us that we have to be responsible for our own money.

My continuing need to shepherd mine allows me to help you better look after yours. At Trust Intelligence, we have developed a superior community of members and subscribers to the Premium Service.

We are fortunate to have George Stovall, an accomplished petroleum profession as our Official “GeoWhiz”. He provides a hands-on view of the companies, people in the Petroleum business and lets us benefit from his extensive knowledge of petroleum geology in fields, the world over, based upon his extensive personal experience. George has degrees in Geology and Geophysics and has traveled the world for 25 years, studying geology and people and putting them together as “deals”. He’s an invaluable source for those of us that realize that energy is the backbone of any economy. And he’s a generous and open teacher who is happy to educate us on the jargon, basics, and nuances of the energy business.

Our other pillar of strength comes from the members of the Trust Intelligence family, and especially the Premium Service. They provide an oasis of support, information and civility in an often nasty world. Our people are very accomplished in their own fields and as investors. We have entrepreneurs, inventors, mathematicians, healthcare practitioners, pension experts and other financial professionals, lawyers, medical researchers, IT people, engineers, physicists, and chemists who are innovative and have extensive experience all over the world. I am proud that they find Trust Intelligence and the Premium Service to be valuable. I hope you will, too.
Alan
Alan Ross, Ph.D.
Founder & Chief Cook & Bottle Washer
Trust Intelligence/Premium Service
Camden East, Ontario