SciVest Capital

About The Managers

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Dr. John Schmitz

Dr. Schmitz is one of Canada’s foremost authorities on global equities and global derivatives. He is responsible for risk management and chairs AlphaDelta’s Investment oversight Committee for the AlphaDelta family of funds. Dr. Schmitz holds a BESc (Mechanical Engineering), a BA (Economics) and a DHS (Honours Economics) from the University of Western Ontario, a MA (Economics) from the University of Toronto, and a PhD (Finance) from the Richard Ivey School of Business at the University of Western Ontario. He also holds the Chartered Financial Analyst (CFA) designation

About SciVest Capital Management Inc

SciVest brings together both science and investing in its portfolio management. The manager uses sophisticated quantitative analysis and extensive fundamental analysis to create portfolios. Originally founded in 1999, SciVest has been managing global equity and equity derivative portfolios for over two decades.

Scivest focuses 100% of its efforts on its “Growth of Dividend Income Strategy”, with the objectives of delivering investors: (a) a consistent and above average current distribution yield (i.e., income yield), (b) meaningful growth in the absolute level of distributions (i.e., income growth) through time, and (c) meaningful long-term capital appreciation.

What Does The Fund Invest In?

The Fund will invest primarily in larger capitalization, global, dividend paying, equity securities (including securities of unit trusts, real estate investment trusts and depository receipts) and their derivatives, with the intent of providing its shareholders with (in order of priority):

  • a consistent distribution yield
  • growth in the absolute level of distributions per share through time, and
  • long-term appreciation of capital

The Fund’s portfolio advisor applies a highly disciplined value-investing approach, emphasizing capital preservation and a focus on absolute return and risk. This process supports the goal of identifying companies which have the potential to be leaders in their field. The Fund’s portfolio advisor follows a bottom-up, fundamental process in which each company is thoroughly examined with a view to determining whether, in the portfolio advisor’s opinion, the company provides the potential of long term value to investors at time of purchase. Each investment is evaluated over a long-term holding period, with the expectation that it should be worth significantly greater value five or ten years out.

The Fund’s portfolio advisor believes that focusing on dividend paying companies that are expected to grow their dividends through time results in long-term capital appreciation of the portfolio. That is, long-term capital appreciation of the portfolio is a consequence of focusing on attractive growth of dividend investments. The portfolio advisor will also attempt to further enhance capital appreciation by tilting the portfolio towards dividend growth stocks of cheaper, higher quality, faster growing companies and continuously monitoring such holdings for adverse changes in investment fundamentals.

When making investment decisions on behalf of the Fund, the portfolio advisor will consider:

Our approach to investing is characterized by:

  • dividend payment history
  • dividend payment expectations (sustainability and growth)
  • applicable dividend withholding taxes
  • earnings, cash-flows and dividend pay-out ratios (both historical and forward looking) as they relate to a company’s ability to continue to pay and grow its dividends
  • stock valuation and historical stock price trends in relation to dividend payments to determine best entry points
  • the issuer’s long-term “story” and business model
  • company relative attractiveness to the Fund’s other holdings and potential holdings, and
  • overall portfolio diversification and risk implications of adding any specific company and its stock.

The Fund’s portfolio advisor believes that focusing on dividend paying companies that are expected to grow their dividends through time results in long-term capital appreciation of the portfolio. That is, long-term capital appreciation of the portfolio is a consequence of focusing on attractive growth of dividend investments. The portfolio advisor will also attempt to further enhance capital appreciation by tilting the portfolio towards dividend growth stocks of cheaper, higher quality, faster growing companies and continuously monitoring such holdings for adverse changes in investment fundamentals.

Portfolio Structure and Time Horizon

The Fund’s investments will be diversified by individual holdings, industries, sectors and countries. The portfolio advisor expects to hold securities of between 50 and 100 issuers (including unit trusts, real estate investment trusts and depository receipts) around the world in the Fund’s portfolio, with no holding generally exceeding 4% of the net asset value of the Fund. Across the entire Fund, the portfolio advisor expects the issuers held in the Fund’s portfolio to possess higher than average market capitalization, current dividend yield and dividend growth, with cheaper than average valuations metrics and lower than average volatility.