08/17/2018

AFG Client Q&A – Stephen Hamer, CFA, CIBC Wood Gundy

 

Stephen Hamer, CFA
Portfolio Manager
CIBC Wood Gundy – Hamer-Allen Group
AFG Client Since 2012

1.Can you tell us a little about the Hamer-Allen Group (Who you serve, philosophy)?

We provide a full range of wealth management services to high net worth families. This includes meeting their financial needs including, but not limited to, managing their investment portfolios. Over the years we have developed and refined an approach that includes the AFG investment methodology that focuses largely on cash flow and invested capital valuations. Having been in the investment business for over three decades, I have looked at a number of approaches and services and this is the only one that really makes sense to me. It is based on real world investing as opposed to untested theories. Also, it has withstood the test of time so I can invest with confidence when I use their ratings.

2. You have been a client of The Applied Finance Group (AFG) for over 6 years, what sets AFG apart from other equity research providers?

There are a few things that sets AFG apart. First, they are very helpful and responsive to our needs. We do not have a lot of resources to manage technology and they are helpful in teaching how to use the site. Also, their search and analytical tools have made it far easier for me to narrow down my focus to the few companies that we should be investing in. We have a low turnover strategy so having a tool that allows us to value companies properly allows us to hold our positions through good times and bad. Obviously, it is not the only source to research or tools that we use. However, it is a key component to what we do.

3. The AFG50 strategy in 2017 was named a top five core strategy by Pension and Investments.  However, there are points in time that the AFG50 has underperformed, can you explain your approach to using the AFG50 and AFG’s research approach during times of underperformance?

No strategy will outperform all the time. For example, when commodity shares are doing well, particularly during more speculative phases of the market, AFG underperforms. Having said that, it is actually a good leading indicator for me. It generally means the market is getting more frothy. It also means the stocks that rank well in the AFG system become better value and when market sentiment changes, the stocks that have been out of favour do particularly well.

4. How does your use of AFG’s research and models help with client communication?

It helps us explain our approach better. It also makes it clearer in my own mind so that we can be more confident with our decisions in a very uncertain world.

5. Any additional comments about AFG?

I have always enjoyed talking to and working with the people at AFG. They feel like our partners and help us to achieve our business goals. I would recommend it to anybody who takes investing seriously.