A New Breed of Asset Manager

After years of working with and for asset managers, investment banks and brokerages, the founders of Clear Asset Management Inc. saw a “moment in time” where they were compelled to establish a new type of investment management firm. In particular, when observing the success, mediocrity, and failure of many asset managers, they noticed that average and underperforming firms lacked a key factor: the combination of both a strong investment process and sound business practices. In search of a meaningful alternative to the status quo, they conducted extensive research to create a new take on the investment process and management of the business.

The formation of Clear Asset Management began with the development of its investment process. The changes in securities law, principally Regulation FD (fair disclosure) and Sarbanes Oxley, ensure that all corporate data is released to everyone at the same time. These laws also ensure the integrity and uniformity of the information; however, they vastly add to the amount of data public companies report to their shareholders.

Processing this new “surplus of information” was a founding principal of the firm. It is performed daily with the firm’s proprietary technology, providing Clear Asset Management with the beginnings of what the industry describes as an “information advantage.” Computing power and well designed software alone cannot assess the constant aberrations and anomalies presented by dynamic markets. Human oversight is required to prevent faulty recommendations that can arise from inaccurate data, unusual situations, and fraud.

Today, the firm takes a new view on market segmentation, sector analysis, industry selection and, ultimately, stock selection and portfolio construction. At the core of the investment process are “multifactor models with human oversight.” Layered on top of this core is a strict sell discipline, trading strategy, and risk assessment / action process.

Because of this, the firm cannot be placed in one of the standard boxes: quantitative or fundamental. Additionally, the firm does not claim to have captured the best from each approach. The process was created independently of traditional methodologies and disagrees with some conventional wisdom. Clear Asset Management’s process eliminates or automates many steps in the traditional investment process, then utilizes fundamental research to verify recommendations before turning them into a trade.  Streamlined and efficient, the process was formed to be consistent and deliver strong long-term performance that doesn’t rely on any individual.

Clear Asset Management Inc. has named the process “supervised quantitative” equity strategies because the firm does not blindly execute the output of its proprietary multifactor models. The following descriptions are well applied:

• Fundamentally-driven proprietary multifactor models
• Process-driven human oversight
• Well documented Buy and Sell disciplines
• Risk measured and managed
• Disciplined and process-driven
• Stock picking not rapid trading
• Transparent
• Strong focus on operations and compliance
• Majority women owned
• Conflict free

Clear Asset Management has managed money since September of 2004. Over the last four years, the firm has solidified its management team, most notably by recruiting industry veteran Fred Fraenkel in April 2007 and appointing him chief investment officer in June 2008. Additionally, Clear has strengthened its back office with the appointment of both a COO and CAO.