Behavioral Finance

Sterling's Behavioral Finance team is based in Charlotte and manages complementary strategies to those offered through its fundamental research-driven teams. Our research and investment process is grounded in the principles of behavioral finance:

• Behavioral finance has roots in academia.
• Successful active management is possible by understanding and capitalizing on the psychology that drives many investment decisions.
• The key to the process is a proprietary framework that identifies and captures valuation and momentum anomalies.

Sterling Capital Uses Two Primary Factors In Our Behavioral Finance Stock Selection Models:

• Value
• Momentum

Portfolio Construction:

• Focus on portfolio construction (exposure to our behavioral finance based value and momentum factors) rather than individual stock selection.
• Investor's predictable irrationality leads to valuation and momentum anomalies that we believe will continue to exist.
• Through a disciplined portfolio construction process, one can capitalize upon the anomalies.

Portfolio Strategies:

• Small Cap Value Diversified Alpha
• Large Cap Value Diversified Alpha
• International Diversified Alpha