Thursday Apr 13, 2023
Educational Series: A 4-Minute Deep Dive on Sector-Based Equity
In this In Focus Educational Series episode, Portfolio Manager Candis Fitch, CIM®, CIWM, explains the concept of sector-based equity strategic asset allocation, which is a strategy for setting targets or ranges for various economic sectors within the equity component of a portfolio.
Much like the episode on Strategic Asset Allocation (SAA), sector-based SAA uses many of the same principles to determine allocations – this time to economic sectors instead of asset classes. Allocating the equity component of a portfolio by sector instead of geography allows portfolio managers to better diversify portfolios as they are not limited to invest in securities within a specific geographical location. The world is very much a global economy, making it less important about where a company’s headquarters are located. She discusses how this approach can remove biases and helps IAIC to focus on the quality of the company in each sector vs just the geographical location.
DISCLAIMER: The material in this presentation has been prepared by Independent Accountants’ Investment Counsel Inc. (IAIC). Information in this presentation, including forecast financial information, should not be considered as advice or a recommendation to investors and does not take into account your particular investment objectives or financial situation. Before acting on any information, you should consider the appropriateness of the information and speak with one of our portfolio managers. All securities and financial products or instrument transactions involve risks, including the risk of adverse or unanticipated market, financial or political developments and, in international transactions, currency risk. This presentation may contain forward-looking statements, including statements regarding our beliefs on current expectations and market conditions. Readers are cautioned not to place undue reliance on these forward-looking statements. IAIC does not undertake any obligation to publicly release the result of any revisions to these forward-looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside IAIC’s control. Past performance is not a reliable indication of future performance.