Cavalier Investments, a mutual fund manager-of-managers, has approved the designation of nine firms as interim sub-advisers for its suite of funds, effective 1 August 2016.
Permanent sub-adviser status is expected to be granted within 90 days, subject to proxy vote of shareholders.
Firms appointed include Beaumont Capital Management, Bluestone Capital Management, Carden Capital, Efficient Market Advisors, Julex Capital Management, Navellier & Associates, Parasol Investment Management, StratiFi and Validus Growth Investors.
In the role of sub-advisers, the firms will provide active management to Cavalier Investments determining each funds’ allocation positions.
“These firms were carefully selected for their high-quality, defensive-oriented, and tactical, rules-based approach to investing,” says Gregory A Rutherford, chief executive officer, Cavalier Investments. “We believe portfolios should adapt to changing market conditions and each of these firms aligns with our philosophy. Given recent market volatility, and the need for tactical funds that are versatile and protective, we are pleased to partner with firms that bring a proven track record with this strategy.”
Cavalier adheres to the theory of adaptive correlation in the creation of flexible portfolio solutions that seek to provide benchmarked performance in growth periods and loss-mitigation in rapidly changing down markets. Through an extensive process of research, testing and due diligence, each sub-adviser has been chosen for its alignment with Cavalier’s investment philosophy and performance standards.
“In partnering with Cavalier, we offer two tactical and quantitative processes that remove emotional reactions to market movements,” says Dave Haviland, managing partner and portfolio manager of Beaumont Capital Management. “Our Sector Rotation and Decathlon strategies that are now employed by Cavalier are designed to provide the degree of market exposure investors desire, with built-in risk controls to help mitigate large market and sector declines. We’re pleased to join a team of respected and experienced firms, selected by Cavalier after careful review and due diligence.”
As frequent volatility has shaken investors and an historic bull market run exhibits signs of weakness, the need for more tactical protective offerings has grown.
“We believe the 1950s buy-and-hold approach is not sufficient for today’s investors,” says Scott Wetherington, chief investment officer for Cavalier. “We’ve seen too many steep downturns in recent memory and investors deserve a more responsive solution. When the market is down 10 per cent, that is no time to create a sell strategy. With these funds and the proven sub-advisers and managers behind them, investors have more options in both expanding and contracting markets.”