Investment Philosophy
Severin Investments actively manages diversified portfolios of stocks, bonds, and ETFs for its clients. We use a top down approach to adjust our clients' portfolios to changing market conditions, and choose individual securities that balance growth potential with our clients' tolerance for risk. The result is an efficiently diversified investment portfolio that is targeted to the client's investment mandate.
As a fiduciary, every investment decision we make is for the benefit of our clients. We have no incentive to sell you on risky investments or make changes to generate a commission. We only succeed when you do.
Diversification
Diversification is more than just owning a lot of different securities. In fact, you can own hundreds of stocks inside mutual funds and still be under-diversified. Or you can be over-diversified, which defeats the purpose of implementing any active management.
Effective diversification is about building an efficient portfolio that creates intentional exposure to securities that bring different characteristics to the portfolio. Some securities are chosen to enhance stability, while others are chosen to enhance growth potential. The ideal balance depends on your investment objective and where we are in the market cycle.
Active Investment Management
Active investing involves implementing changes in an investment portfolio to help it adapt to market conditions. We use a top down approach to first examine how to weight the asset classes (large cap stocks, international, small cap, short term fixed income, etc.) in a portfolio. Then, we analyze which sectors and industries we should focus on. Finally, we select individual securities, over-weighting securities from those asset classes and industries that we expect to outperform.
Disciplined Decision Making
Active investment management can be somewhat flexible. To ensure we adhere to your investment objectives when making investment decisions, we set certain firm-wide and portfolio-specific mandates. For example, we never invest more than 2 - 3 percent of any portfolio in a single stock. This is a firm-wide mandate. Clients invested in our SI Current Equity Income portfolio must obtain a higher than market dividend yield-- a portfolio-specific mandate. These mandates improve our decision-making. And our decades of experience with managing investments further disciplines our decision-making.
