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Strategy Overview: Internet Stock Investing
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Clear Asset Management - Investment Process
Clear Asset Management offers five long-only institutional-style portfolios and alternative investment strategies.
For the long-only institutional strategies, each portfolio is comprised of stocks rigorously selected by the firm's proprietary multifactor models with human oversight. This is combined with the firm's process-driven trading strategy, sell discipline, and a risk management process for overall portfolio construction and management.
Clear Asset Management developed multifactor models that enable the firm to gain an information advantage through swift and proprietary processing of enormous amounts of fundamental data generated by complex markets and extensively reported corporate financial information.
The accuracy of the data is a direct result of laws enacted after numerous Wall Street and corporate scandals. Most significant are the laws which compel public companies to disclose more financial information. These laws hold senior management and company's auditors personally responsible for the quality and the timing of the information.
Every market day, the multifactor models evaluate the universe of more than 4,000 mid and large cap companies and ADRs traded on US markets; each of these companies reports nearly 6,800 data points. The multifactor models process this vast amount of information and then screen and rank every stock based on potential indicators of strong growth or exceptional value. The rankings can be sorted by style, market cap, or an investment thesis.
Each new potential stock selected by the multifactor models for the portfolios undergoes human oversight for data integrity and various risk factors beyond what software alone can calculate and process.
The multifactor models were developed using research, industry best practices, and observations gained by investigating what Clear's rankings would have been for the historic holdings of successful investors. Each facet of the work was rigorously back-tested.
Clear Asset Management's Sell Discipline is as important as the stock selection process discussed above. Changes to long-only institutional portfolios occur for reasons which include the following:
- A new stock enters the top ranks
- A stock drops from the top ranks
- Style drift
- Questionable data
- Protection of gains
- Downside limits
Individualization
With Clear Asset Management's long-only institutional portfolios we have the power to customize and choose whether or not to hold a stock in a portfolio based on a client's objectives, goals and mandates. As such, clients can elect to exclude certain individual stocks or sectors of stocks.
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