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Advice from a TopGun Investment Mind: Stay humble

Pyramis Global portfolio manager Joe Overdevest's strong roots inform his award-winning ways - and explain his knack for finding firms that hit pay dirt

By: GAIL JOHNSON

Date: December 29,2014

Joe Overdevest learned early on that life on a farm is never easy. Days were long on his parents' tree farm in Windham Centre, Ont., where the portfolio manager for Pyramis Global Advisors, a Fidelity Investments company, grew up helping to plant and care for thousands of maple and spruce trees.

He credits his success as an award-winning fund manager to all that hard labour.

"There were a number of things I learned, but the biggest lesson was that of hard work," Mr. Overdevest says. "Hard work pays off no matter what you're doing, whether it's a tree farm or investing. Hard work is the differentiator, and the bedrock of what I do today is from that experience."

"There's a discipline you need on a farm day in and day out," he adds. "You can't just take it easy. I spent a lot of time turning over rocks, and that extends to the investment process."

Overseeing approximately $5-billion in equity assets at Fidelity Investments, Mr. Overdevest has earned accolades for his portfolio management. Most recently, he was named a 2014 TopGun Investment Mind in the Brendan Wood International Canadian investment rankings for the third year in a row.

He also co-manages the Fidelity Global Natural Resources Fund, which won two 2014 Lipper awards in the Natural Resources Equity category for the three- and five-year time periods. The awards recognize exceptional performance throughout the professional investment community.

The lead manager of the Pyramis Canadian Focused Equity strategy fund and a member of the Fidelity Canadian Asset Allocation Team, Mr. Overdevest also manages a subportfolio of the Pyramis International Growth strategy fund. He co-manages the Pyramis Canadian Core Equity and Pyramis Canadian Systematic Equity strategies funds, in addition to the Fidelity Canadian Equity Private Pool and Fidelity Concentrated Canadian Equity Private Pool funds.

Mr. Overdevest studied business at Wilfrid Laurier University in Waterloo, Ont., graduating with honours in 2002. He says his intention was to acquire the skills needed to one day take over the farm, which his parents and two siblings still operate. However, a co-op term with an investment firm changed that. He worked in high net-worth asset management and quickly became fascinated by the very different kind of hard work involved in investing compared with farming.

"It appealed to me because it's very intellectually challenging," Mr. Overdevest says. "Every day is something new, and you're always thinking three, four, or five steps ahead. You have to think about what could happen going forward, and it's very stimulating. When I entered university I thought I'd be an entrepreneur, and although investing is not running a business, you're analyzing businesses across various sectors day in, day out, finding their potential, meeting with CEOs and CFOs, reading annual reports - turning over rocks."

Mr. Overdevest did other co-op placements before completing his education. Four days after graduating, he headed to Boston where he worked as an equity analyst covering oil and gas, telecommunication services, retail, diversified financials and automotive parts.

He joined Fidelity in 2002 as a research analyst with Team Canada, the research and portfolio management team for investment products sold through Fidelity Investments Canada ULC.

In selecting which stocks to invest in, Mr. Overdevest takes into account not just individual companies but also how those entities act as a group. Part of his competitive advantage, he says, is the size and quality of Fidelity's team, which has more than 800 investment professionals around the globe, allowing his clients access to invaluable local, national and international perspectives. There's also a separate risk-management team dedicated exclusively to routinely monitoring portfolios to ensure that they're structured appropriately for clients.

In mitigating risk, Mr. Overdevest draws further on his farming background.

"On the farm, you have to stay humble," he says. "That stays with me today, much like hard work. When you're investing in the market, there are going to be ups and downs, and just because there may have been very positive results on one stock, you still have to look at where you could be wrong. Trying to be prepared for the unknowns helps. You can never know everything, so by being humble and asking yourself where you could be wrong helps to reduce stress. Then if something happens you'll have an idea of what you need to do to take new action."

"Really knowing your stocks and the fundamentals of a company relieves stress, too," he adds. "Often people have stress if stock goes down, then it all goes back to fear and greed. If you know the company and know what drives the stock price and research the companies, you're not trying to make bets for clients. You're making investments."

Mr. Overdevest recently gave a presentation to students about how to enter the investment field and was asked what his top piece of advice was for young people. It wasn't to focus on price-earnings ratios or return on equities.

"The biggest thing I would concentrate on is your reputation," he says. "It takes decades to grow and develop, and it can take a moment to lose it. For me, it's not just hard work that I learned at the family farm that's important but also how you treated people. On a farm, especially in a small town, it's very important how you treat customers and suppliers and how you interact with them. That still helps me when assessing companies; I look at how they treat their suppliers and their customers and how the CEO may treat investors. It all goes back to your reputation."

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