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Our Methodology

SFA employs a broadly diversified investment approach, capitalizing on the strengths and performance of the world's foremost money managers.

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Our Investing Philosophy

SFA employs a broadly diversified approach to investing. We begin from the “top down” – assessing the big picture before choosing specific investments for each client. By first analyzing the macro economic environment, we identify trends and ascertain whether they are in their early or late stages. From this vantage point, we analyze historical market data and current market conditions, to narrow the scope of appropriate opportunities. This rigorous process eliminates thousands of potential investments – many of which are well known – yet are identifiably poor choices from our perspective.   From this remaining group, we apply time tested tools of asset allocation, rebalancing and diversification, creating a strategic and effective investment program.

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Our View on Asset Allocation

An important but little known fact is that asset allocation is the primary driver of performance in an investment portfolio.   Simply put, asset allocation means dividing assets among available investment classes.   Primary asset classes include equities, bonds, cash, and alternative assets such as Master Limited Partnerships (MLPs) as well as Canadian Royalty Trusts (CanRoys). SFA allocates each client's assets based on their specific objectives, time horizon, risk tolerance, liquidity needs, and current financial condition.

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Our View on Diversification

Diversification is one of the most discussed topics in the investment arena. Generations past have long endorsed diversification as a means by which volatility is managed and downside limited. The bull market of the late 1990s brought about new theories as many decided to invest in a handful of names within a few sectors. The “new” theory held that diversification only ensured mediocrity. However, as the March 2000 meltdown occurred, the subsequent bear market dealt severe blows to most portfolios. Diversification has moved – predictably – back into the limelight. SFA has always operated under, and continues to follow the principled position that diversification mitigates risk with negligible influence on upside potential.

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Our Use of Hedging

SFA periodically hedges client portfolios. We use this tactic primarily to protect portfolio gains in events of special and extraordinary circumstances such as war, a geopolitical event, terrorist attack, or where analysis indicates an unsustainable market advancement. We employ no load mutual funds that short a specific index like the S&P 500 or the Nasdaq 100. These vehicles have an inverse relationship to their correlating index, thus offsetting the movement of the index. Hedging, on an as-needed basis, not only protects profits, but reduces volatility during clearly uncertain environments.

“Spread your portion among seven or eight ways for you do not know what misfortune may befall the earth.” -Ecclesiastes 11:2