Diversification Investment Philosophy – Lebed Asset Management
All clients have a core portfolio of individual stocks diversified by sector and market capitalization:
- Sector diversification ensures that portfolios include a balance of stocks in key areas such as consumer cyclicals, consumer staples, energy, financials, healthcare, industrials and technology. This balance limits portfolio volatility that could result from excessive sector concentration.
- Diversification by market capitalization ensures a balance between small, medium and large-sized companies and similarly limits volatility of returns.
Clients’ core portfolios can be augmented to create a fully diversified portfolio, including:
- additional asset classes such as fixed income, real estate, commodities, currencies and other diversifiers and
- stock exposure in categories not fully captured by the Sustainable Value strategy, such as emerging markets, international and growth.
- These complementary holdings generally consist of mutual funds and ETFs, but may also include individual bonds for larger accounts.
- We emphasize out-of-favor sectors and contrarian managers.