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
Behavioral Finance Team Biographies