Jason Donville

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Thegipper
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Jason Donville

Post by Thegipper »

Jason Donville. He was a market guru for 3 or 4 years. For a while everything he recommended was gold. Now he is no where to be seen or heard.. A core theme was looking for stocks with a high ROE. It was a good metric among others. The problem many of these stocks were highly leveraged. If you can borrow money and use it to acquire other companies the ROE can be misleading. Based on the Donville experience I have come to the conclusion that ROC is a far better metric. If a person had focused on this metric Valeant, Concordia , CHR medical would have been eliminated. It's funny how certain people come along who can drive stocks higher . Donville was one of them. He would be on BNN and one could see his stock recommendations almost immediately charging up.
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Re: Jason Donville

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Indeed. I have been one of the few folks to mention ROCE (Return on Capital Employed) as a metric in posts now and then. ROE alone can leave one high and dry, although if used in conjunction with Debt/Equity ratio... it can accomplish the same thing as ROCE.
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Re: Jason Donville

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IMO, the reason for Donville not being seen on BNN is twofold. First, his firms AUM had reached the sufficient size for him to get much benefit from appearing in business media. BNN appearances became less frequent after his funds stopped taking new money. Second, he tripped badly on Valeant and then doubled down on his opinion of the firm in a rather on BNN at the worst possible time.

Donville is no doubt an excellent investor. Simply look at the returns since inception of his funds. This phenomenon is the sad reality for asset managers. Investing is a long run game and strikeouts are inevitable. Even worse, sometimes you get hit by the pitch!

Similar to recent opinions on Ackman, Watsa, Pabrai......all of whom are outstanding long term investors who were boo'd when near term performance declined sharply from long term performance.

IMO, in this game you have to evaluate by process and long term returns not short term outcomes.
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Re: Jason Donville

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FinEcon wrote: 22 Sep 2017 11:11 Donville is no doubt an excellent investor. Simply look at the returns since inception of his funds. This phenomenon is the sad reality for asset managers. Investing is a long run game and strikeouts are inevitable. Even worse, sometimes you get hit by the pitch!
I certainly cannot dispute Donville's excellence as an investor, and I was often tempted to follow his advice. The only thing that held me back was his preference for small caps, and his repeated claim that it was not necessary for the average investor to hold more than a dozen stocks.
As for the performance of his "Capital Ideas" fund, it did absolutely great for a couple of years, but it has languished since the summer of 2015. I don't follow Market Call as much as I used to, but it would be certainly be interesting to hear from him again.
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AltaRed
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Re: Jason Donville

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Stockchase keeps track of (sort of) so called 'experts' picks and how those picks have done. JD has not been active in this space since early 2016. http://www.stockchase.com/expert/view/1287

I've not taken any time to dig that deep on any of the so called experts.
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Re: Jason Donville

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AltaRed wrote: 22 Sep 2017 15:06 Stockchase keeps track of (sort of) so called 'experts' picks and how those picks have done. JD has not been active in this space since early 2016. http://www.stockchase.com/expert/view/1287

I've not taken any time to dig that deep on any of the so called experts.
Coinciding with his funds closing to new money, newsletter going private, and fewer BNN apperances. The only people who know the holdings are fund unit holder or people who have obtained recent copies of ROE Reporter.
schmuck wrote: 22 Sep 2017 13:43 I certainly cannot dispute Donville's excellence as an investor, and I was often tempted to follow his advice. The only thing that held me back was his preference for small caps, and his repeated claim that it was not necessary for the average investor to hold more than a dozen stocks.
As for the performance of his "Capital Ideas" fund, it did absolutely great for a couple of years, but it has languished since the summer of 2015. I don't follow Market Call as much as I used to, but it would be certainly be interesting to hear from him again.
I suspect, but cannot confirm, Valeant and Concordia punched huge holes in his recent performance. But how many people run money in a fairly concentrated manner remained flat at the portfolio level when a couple of holdings lost 90% or so tip to trough? How many energy analysts fund holdings suffered terribly in the past couple of years? And in case anyone asks, no I'm not JD and have no econmic or social interest in defending the guy. My only real point here is that mark to market near term performance can suffer no matter how a person invests.

What separated JD from other guests on BNN is that he had a good handle on the stocks he spoke about and their financials. Most BNN guests have not read the K's and Q's and often have no legitimate understanding of the firms they speak about. If you are a diligent investor and watch BNN guests speak on stocks you've researched well you know exactly what I'm talking about.
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Re: Jason Donville

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You have some respect for Jason Donville?
I think this VRX rant from a year ago is why he is no longer on BNN.
I remember watching this baffled and amused at the rage and lack of professionalism.

His funds have done nothing since 2015. :)
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AltaRed
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Re: Jason Donville

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Money managers often have a winning streak with their methodologies for awhile, but most narrow methodologies have their shortcomings and downfalls. Some (many?) just don't know when (or how) to get off that particular pony.

FWIW, I thought Amber Kanwar was really good on BNN Market Call but clearly they had to move her because she was too challenging of all those fragile egos. Her talents were wasted there anyway. Better in her current Business Day AM slot et al?
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Re: Jason Donville

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Descartes wrote: 22 Sep 2017 16:20 You have some respect for Jason Donville?
I think this VRX rant from a year ago is why he is no longer on BNN.
I remember watching this baffled and amused at the rage and lack of professionalism.

His funds have done nothing since 2015. :)
I don't know the guy and couldn't care less if he went on a verbal tirade on BNN, I would welcome the chance to have a beer and discuss investing with someone of his skill level any day of the week. What I did say that is absolutely true, is that his investing track record is excellent.

I took his CAGR from this page because it was easy due to the chart, it's in excess of 20% since inception https://donvillekent.com/product-historical-perf-CI.php

I'm not easily offended so something like this, which I too watched the day it happened produced laughter in my office.
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Re: Jason Donville

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Four of his major concentrated positions were Home Capital, Valeant , Concordia and CRH Medical. Can you feel the pain. Again I think the lesson to be learned was the enormous amount of debt that was accumulated to bring about their growth. Growth by three of these operations was through acquisition and questionable practices after the acquisition i.e. slashing research and jacking up the price of drugs.
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Re: Jason Donville

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FinEcon wrote: 22 Sep 2017 20:18I would welcome the chance to have a beer and discuss investing with someone of his skill level any day of the week.
I can just imagine that date.

Frail Miss Finecon holding the stem of her glass of Appletini in her trembling fingers while Jason stares
ferociously at her cleavage through his Mister Magoo glasses then downs another gulp of Budweiser.

"Soooooo.. how..how would you categorize your investing philosophy, Mister Donville?"

"It's all about ROE, baby. R..O..E. Can you imagine an ROE the size of 45%? That's what I'm all about, baby".

"Well, that's very interesting, Ja-"

"Do you think there are many companies out there with a 45% ROE? Let me tell you: there aren't.
Can you imagine what I could do with an ROE of 45%? Pay off debt. Boom. Acquire something else? Boom.
If you've got a big enough ROE then you can do pretty much *anything*, honey an I want to show you that"

"o..k.. well it really has been a lovely evening and I really want to thank you for sharing your investing skills with me-"

"oh yeah, I wanna share my investing skills with you I wanna put *all* a my investing skills into you.."

"It is very late and I think I need to get going-"

"Wait, wait - you're leaving? But I haven't told you everything I know."

"My parents are going to be worried.."

"You still live with your parents? Aren't you over 30? Nevermind. Look, baby, I'm ..*accountable". You know what that means?
I bet there isn't anyone else in this bar that is as accountable as me. You think there's some bozo in Nevada sitting
around with this kind of accountability? You should *only* lissen to someone who is accountable."

"Thank you, Mister Donville. It has been very illuminating but I really really have to go.."

"Sure, you go on then little Miss Finecon.
You go on... shit, bet you can't even spell ROE."
"A dividend is a dictate of management. A capital gain is a whim of the market."
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deaddog
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Re: Jason Donville

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Thegipper wrote: 22 Sep 2017 21:01 Four of his major concentrated positions were Home Capital, Valeant , Concordia and CRH Medical.
I'm impressed that he managed to lose only 1.66% of his portfolio in 2016, with those stocks being his major positions. He must have done well elsewhere.
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Re: Jason Donville

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Thegipper wrote: 22 Sep 2017 21:01 Four of his major concentrated positions were Home Capital, Valeant , Concordia and CRH Medical. Can you feel the pain. Again I think the lesson to be learned was the enormous amount of debt that was accumulated to bring about their growth. Growth by three of these operations was through acquisition and questionable practices after the acquisition i.e. slashing research and jacking up the price of drugs.
For a long term holders perspective, what pain? The DKAM Capital Ideas Fund LP worst year is -2%. No doubt some recent unitholders bought/sold at the wrong time and had terrible results from the fund but that's not something the manager can control.

Growth from two of those firms is from what you describe. The other two have nothing to do with what you stated. Home Capital is leveraged by the nature of its business. CRH is predominantly anaesthesia services financed by equity expansion.

You guys keep raising small points with no link to the core issue of investing philosophy or long term investing results. Most of the hate seems to be from not liking the guy due to a rant on BNN. So he got mad and ranted at some hot young thing on TV? Who cares and what does that have to do with his investing philosophy or long term track record?
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Re: Jason Donville

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FinEcon wrote: 23 Sep 2017 12:00 You guys keep raising small points with no link to the core issue of investing philosophy or long term investing results. Most of the hate seems to be from not liking the guy due to a rant on BNN. So he got mad and ranted at some hot young thing on TV? Who cares and what does that have to do with his investing philosophy or long term track record?
Didn't realise that we are anywhere near the "hate" zone. Nor would I consider that long term is the ideal approach for a concentrated fund with less than 15 small to midcap stocks. Maybe his strategy has changed, but I was always somewhat concerned that his holdings lacked sufficient diversification, and I would have preferred a bit more capital preservation than swinging for the fence.
It would be interesting to know what his current holdings are.
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Re: Jason Donville

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Different money managers have different strategies. JD had one that appealed to a number of investors, but not others. Other money managers have different strategies. For those buying into such funds, it is important to know what that manager's investing strategy/philosophy is and whether that fits YOUR style and/or needs. Those of us into passive or DIY investing don't/shouldn't care.
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Re: Jason Donville

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schmuck wrote: 23 Sep 2017 13:16 Didn't realise that we are anywhere near the "hate" zone. Nor would I consider that long term is the ideal approach for a concentrated fund with less than 15 small to midcap stocks. Maybe his strategy has changed, but I was always somewhat concerned that his holdings lacked sufficient diversification, and I would have preferred a bit more capital preservation than swinging for the fence.
It would be interesting to know what his current holdings are.
Capital preservation seems to be OK with his funds.

Take a look at the funds drawdowns compared to the up years.

Again it comes down to if the investment objective is maximize returns or portfolio diversification.

The low drawdowns show some sort of risk control is in place to preserve capital.
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Re: Jason Donville

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deaddog wrote: 23 Sep 2017 11:56
Thegipper wrote: 22 Sep 2017 21:01 Four of his major concentrated positions were Home Capital, Valeant , Concordia and CRH Medical.
I'm impressed that he managed to lose only 1.66% of his portfolio in 2016, with those stocks being his major positions. He must have done well elsewhere.
In fairness I think he he got out of Home Capital in 2015 and the collapse of CRH Medical took place in 2017. It was a very hot stock in 2016.
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Re: Jason Donville

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Skill or luck? Surely everyone on here knows that seven years is too soon to tell. How many star managers with hot hand have we seen flame out when given enough time?
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Re: Jason Donville

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ROE is a very important metric. One can use it as guide provided you understand how leveraging can jack up this metric. I avoid them when they have a high debt to equity ratio . Acquistions can be a good strategy as well provided it is done with discipline. I think a good example is Constellation Software.
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Re: Jason Donville

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I wouldn't have bothered to update this except there was some doubt as to Mr Donville's results. Here's the results from DKAM ROE Reporter. How many investors in Canadian equity can say they did this well? Invested with Donville, your $100k became something like $675k in 12 years. Despite Valeant, Home Capital, etc.
The 2010s have come to an end and we have found ourselves both reflecting on the past and thinking of the future. 2019 was another solid year for DKAM. The Capital Ideas Fund returned 19.24% for the year and has achieved a 17.23% annualized return over the last 12 fiscal years...
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Re: Jason Donville

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FinEcon wrote: 05 Apr 2020 01:17 I wouldn't have bothered to update this except there was some doubt as to Mr Donville's results. Here's the results from DKAM ROE Reporter. How many investors in Canadian equity can say they did this well? Invested with Donville, your $100k became something like $675k in 12 years. Despite Valeant, Home Capital, etc.
The 2010s have come to an end and we have found ourselves both reflecting on the past and thinking of the future. 2019 was another solid year for DKAM. The Capital Ideas Fund returned 19.24% for the year and has achieved a 17.23% annualized return over the last 12 fiscal years...
After his huge hissy fit where he lost it regarding Concordia, Valeant, and some others on BNN I think he needed to keep a lower profile and regroup. Not a bad idea. The numbers speak for themselves.
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Re: Jason Donville

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Don't get me wrong I made some excellent returns by investing in some of his recommendations. When one looks back at his longer term success stories you find companies with high ROE,ROC and low debt levels. Stocks like CGI ,Constellation software , Open Text and others. The big bombs were companies who leveraged their growth and ROE through big debt . Its to bad he doesn't get on BNN anymore.
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Re: Jason Donville

Post by nisser »

He's done abysmally since 2015. Looks like his outlier outperformance in 2009 and 2013 is what got him his name

https://donvillekent.com/performance/
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