Our investment process seeks to add value to client accounts in the following ways:

  • Strategic and Discretionary Asset Allocation
  • Prudently Transitioning Out of Existing Strategies
  • Cost-Effective Portfolio Implementation
  • Ongoing  Smart Rebalancing

The first step in our process is to analyze the existing investment portfolio to assess how we can add value as a manager.  We work with the investor to understand the cash flow needs, return objectives, risk tolerances, as well as any legal and policy constraints which would impact investor objectives.  Typically, depending on the investor’s objectives, we determine how we would proceed to build a cost effective diversified portfolio.

If the investor decides to engage Third Sigma, the Third Sigma team, using their expertise and years of experience to implement the portfolio.  We work to minimize costs and cautiously manage capital gains and losses for taxable portfolios.  We then carefully unwind the old portfolio and begin fleshing out the new portfolio.  We have found that value can be added through the transition process, especially in volatile market environments.

Third Sigma employs a long-term asset allocation approach.  Our strategic approach does not attempt to predict short-term performance of individual assets classes but rather assesses how asset classes tend to perform relative to one another over an extended period of time.

Our experience tells us investors often “fall in love” with one part of the marketplace and are as likely to loathe another market segment.  These love-hate relationships contribute to market volatility which may present opportunities for long-term investors.  We believe disciplined investors can capture excess returns by taking advantage of exaggerated market movements in any direction using our Smart Rebalancing approach.

Third Sigma’s strategies generate cash flow from dividends, interest, and capital gains.  Excess cash can be used to dampen volatility or to provide funds to capitalize on market opportunities on behalf of our clients.  We believe that automatic reinvestment of dividends, interest, and capital gains can lead to investment in overvalued assets which may be destined to loss relative value.

We ask our clients to give us full discretion over the asset allocation implementation and rebalancing as we feel that value can be added in this way.  With full discretion to adjust the asset allocation within limits and also, to rebalance when appropriate, we are fully accountable for our performance and fully accountable to clients for their results.

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300 Delaware Avenue
Suite 210, Room 210
Wilmington, Delaware 19801