At a loss for what to post, I decided that I would give you some insight into what a few of my favorite financial products are and why I like them. Today I am highlighting one of my favorite mutual fund managers - Kim Shannon and her company - Sionna Investment Managers.
From the Sionna Investment Managers website:
"Kim founded Sionna in the summer of 2002 and has 23 years ofinvestment management experience. She was previously CIO at Merrill Lynch IM, Canada and led large cap equities at AMI Partners. Kim is past President of the Toronto CFA Society andis currently on the CFA Institute's Canadian Advisory Committeeand the Canadian Coalition for Good Governance's Accounting & Audit Policy Committee."
From the Brandes website:
Sionna's Investment Philosophy and Approach
Sionna is an active investment manager with a value driven, bottom-up approach to stock selection. They manage portfolios with a disciplined, approach that has produced superior long-term returns.
Sionna believes that the stock market reflects human emotions as much as it reflects fundamental value, which leads markets as a whole, as well as individual stocks, to euphoric highs and depressed lows. The Sionna team attempts to take advantage of human emotion by determining the value of securities in a disciplined way that allows them to remain dispassionate.
They believe that stocks tend to revert back to their intrinsic values in the fullness of time, and seek to buy stocks trading significantly below this level and patiently wait for them to revert back to intrinsic value, resulting in conservative portfolios. Sionna manages Canadian equity portfolios in a relative value style.
The Sionna Process
Sionna applies sound, fundamental analysis to find companies that are worth more than their current stock market price. They think in simple terms: buying a dollar’s worth of a company at a price of 70 cents or less. Sionna begins by considering a universe of 500 companies, and through rigorous screening, distills it to about 70 to 140. From this, a focused portfolio of 35 to 60 companies emerges.
Sionna believes that diversification mitigates risk, and therefore favours well diversified portfolios, with no more than a +/- 5% differential to index sector weights. However, they also believe that by focusing on stock selection, rather than sector timing, risk to the investor is further reduced. Therefore Sionna will occasionally go overweight in a sector, or take a zero position, depending on the availability of value opportunities.
Why mohican likes them so much?
1) They are disciplined value investors.
2) They recognize great investment opportunities that many others pass by.
3) They keep fees low because of their initial quantitative process.
4) They outperform over the long run and by a large margin. The fund that Sionna previously managed was the CI Canadian Investment fund which had a fantastic record of outperformance - especially during downmarkets.