Similar to the Sector Plus investment strategy, the PathFinder investment strategy is a disciplined, objective investment process based primarily on a quantitative analysis of fundamental and technical factors. However, unlike Sector Plus, the PathFinder strategy focuses on socially responsible investing. It is a mixed-cap strategy that consists primarily of large-cap stocks with mid-cap stocks making up to, but no more than 30% of the portfolio.

Through a quantitative, formula-driven evaluation of stock price versus earnings growth, Sector Capital Management is able to identify and select quality stocks that are trading at a discount relative to the present value of future earnings. This results in companies with high S&P and analyst ratings that have achieved superior historical earnings growth with relatively low P/E ratios. In addition to stock selection the formula also encompasses a built-in sell discipline. The quantitative nature of the formula allows Sector Capital Management to have a disciplined approach that is repeatable over time and objective.

The 70 – 90 stock portfolio (target # = 80) maintains a market weight in each of the ten GICS economic sectors, and the stocks within each of the ten sectors are approximately equally weighted. With a mix of value and growth stocks, this sector-neutral and style-balanced approach is designed to minimize risk and provide consistent added-value performance over the S&P 500 Index. Furthermore, the PathFinder strategy evaluates market strength and liquidity by selecting stocks that are actively traded and among the leaders in trading volume. The portfolios are reconstituted at least quarterly and rebalanced as needed.

Finally, the PathFinder strategy focuses on socially responsible investing through customized screens that eliminate stocks that derive a significant percentage of revenue from activities violating client guidelines, including such industries as Alcohol, Tobacco, Gaming, Pornography, Weapons of Mass Destruction, and Abortifacients.

The PathFinder strategy is a thorough screening process that is designed to produce a high quality, socially responsible, stock portfolio. It is a quantitative, disciplined approach that is repeatable and objective. The sector-neutral and style-balanced approach strives to control risk and provide consistent added-value performance over the S&P 500 Index. To see the PathFinder strategy’s performance click HERE.