Stan Wong, Scotia Wealth Management Portfolio Manager, Shares Investment Approach and Recent Buys

Stan Wong, a portfolio manager at Scotia Wealth Management, uses a data-driven approach to invest in companies with strong earnings growth and those operating in industries with less competition. He has bought Mastercard and Netflix, and sold Caterpillar, citing their strong fundamentals and growth prospects. Wong's all-equities portfolio has returned 14.3% over the past year and 16.7% over the past three years.

Stan Wong, a portfolio manager at Scotia Wealth Management, is known for his data-driven investment approach. Wong, who oversees approximately $650 million in assets, emphasizes quantitative analysis to guide his active management style. His method involves screening thousands of companies worldwide based on fundamentals such as profitability, free cash flow, capital efficiency, and earnings momentum. He then conducts macroeconomic and technical analyses to inform the timing of buying and selling equities.

Wong's portfolio has demonstrated strong performance, with a 14.3% return over the past year and a 16.7% three-year annualized return. This performance is attributed to his focus on companies with strong earnings growth and those operating in industries with less competition. His portfolio includes about 30 to 35 stocks, with a current equity mix of 59% U.S. equities, 20% Canadian, 6% international, and 3% commodities, along with 12% in cash.

In a recent interview, Wong discussed his portfolio's current holdings and recent moves. He highlighted Mastercard Inc. (MA-N) and Netflix Inc. (NFLX-Q) as stocks he has been buying. Mastercard, a core holding since 2014, aligns with Wong's preference for companies with strong earnings growth and fewer competitors. Netflix, which Wong has owned since 2020, benefits from its leadership in streaming and robust cash flow. Waste Management Inc. (WM-N), another recent purchase, is seen as a stable investment with a strong network of waste management facilities.

Wong also mentioned selling Caterpillar Inc. (CAT-N) recently. He bought the stock during a market selloff but sold it for a 50% gain in early August. The decision was based on the stock becoming overbought and Wong's models indicating it was time to sell. The move was part of his disciplined approach, which involves no emotional attachment to any position.

Wong's strategy and recent portfolio moves reflect his commitment to a data-driven, disciplined investment approach. His focus on strong fundamentals and growth prospects has resulted in consistent, above-average returns for his clients.

References:
[1] https://www.theglobeandmail.com/investing/globe-advisor/advisor-funds/article-why-this-money-manager-is-buying-netflix-and-selling-caterpillar/
[2] https://www.gurufocus.com/news/3085589/caterpillar-cat-excluded-by-norways-wealth-fund-sparks-trade-tensions