All of our actions are based on Relative Strength analysis, a technique that compares the performance of an asset class or an individual investment against other asset classes or investments to determine which areas are attracting investor interest and which areas “smart money” is avoiding or moving away from.
Relative Strength analysis is a technique that compares the price movement of an asset class or security with the price movement of other asset classes or securities to determine which asset classes or securities have the most strongest relative price movement. In essence, we look to decide which investments are the strongest relative performers by comparing other available choices or within a peer group. Relative Strength is a concept that most people use daily. Relative Strength helps us identify the asset classes or securities that we should avoid while identifying the investments that stand out as opportunities.
Our analysis also provides us insight into money flow on a large scale. When money flows are shifting, we can detect price action in various sectors, asset classes, and specific groups of investments. For the comparisons and rankings, the utilization of logarithmic point and figure charting is based on historical price movements.
So what makes SIAWM different from other wealth management firms? We interpret massive relative strength analysis daily on over 80,000 stocks, ETFs, Canadian and U.S. mutual funds, commodities, currencies, and more to understand where relative market strength is.
- Objective: Billions of calculations a day enables us to look at¬†the ranking of¬†each investment objectively within the context of an investment universe.¬†
- Rules Based: Specific guidelines on when to enter, exit or hold an investment removes many of the cognitive and emotional barriers to successful investing.
- Unconstrained: We are not tied to being 100% invested in equities all the time, especially during time periods of major¬†uncertainty or risk.¬†SIAWM¬†has the ability with specific market signals¬†¬†to¬†move to¬†cash¬†and cash equivalents. This is one of the risk management tools employed by SIAWM.¬†
In our opinion, there are two dominant investment mandates currently being followed by money managers worldwide:
1. Long Only Fully Invested ‚Äď These managers are always invested in the stock market, hold minimal cash, and only have long positions focused on the longer term.
2. Alternative Strategies ‚Äď These managers typically pursue shorter term or market neutral strategies in an attempt to hedge away market risk and capture relative returns. These managers may hold asset classes other than stocks and have the ability to take on short positions.
At SIA Wealth Management, we look to capture both of these mandates’ advantages while avoiding their weaknesses by following an Unconstrained Mandate. Our mandate holds long positions in stocks and/or ETFs that track stocks when equities show relative strength, while giving us the flexibility to move to alternatives, including cash when stocks are out of favor and falling.
Our Unconstrained Mandates are focused on Absolute Returns and Absolute Risk Management. Our goal is to capture positive returns in bull markets, capital preservation in bear markets, and capital invested in the markets with the strongest Relative Strength throughout the cycle. Our focus on Absolute Risk Management means that we, based on our analysis, rotate out of falling and under-performing markets.
- Strong diversification strategy and approach
- Absolute Performance & Absolute Risk Management
- Designed for both bull and bear markets
- ETF utilization for better asset class shifts, transparency, and costs