A. Description
Lorne Steinberg Wealth Management Inc. (“LSWM”) is organized as a corporation
under the laws of Canada. LSWM provides discretionary investment management
(and investment sub-advisory) services to individuals, corporations and non-profit
organizations. Client funds are advised or sub-advised through both separately
managed accounts and pooled funds, depending on the circumstances. LSWM is
owned 100% by Lorne Steinberg and was formed on April 6, 2009. In the U.S.,
LSWM is registered as an investment adviser with the U.S. Securities and Exchange
Commission (“SEC”). In Canada, LSWM is registered as a portfolio manager,
investment fund manager, exempt market dealer, and financial planner. In this
regard, LSWM is registered in Alberta, British Columbia, Manitoba, New
Brunswick, Newfoundland and Labrador, Nova Scotia, Nunavut, Ontario, Prince
Edward Island, Quebec, Saskatchewan, and Yukon.
B. Advisory Services
As further described below, LSWM currently offers the following three types of
investment advisory services: (1) separately managed account services, including
through sub-advisory arrangements, (2) pooled funds, which are not currently
available for direct investment by U.S. investors, and (3) financial planning services.
Our approach to investing is value-based.
Traditional Investment Advisory Services
LSWM serves as a traditional investment adviser to separately managed accounts.
In this regard, its separately managed accounts generally follow the same portfolio
construction process as each other. However, in its sole discretion, LSWM may
also customize an investment portfolio in accordance with a client’s risk tolerance
and investment objectives, including reasonable restrictions on investing in certain
securities or types. For example, clients may specify in their “Investment Policy
Statement,” which outlines each clients’ current situation (income, tax levels and
risk tolerance), that investments in any particular stock or industry should not
exceed a specified percentage of the value of the portfolio and/or restrict or prohibit
transactions in the securities of a specific industry or issuer, including socially
responsible investment restrictions. Once we construct an investment portfolio, we
monitor the performance of each client’s portfolio on an ongoing basis and
rebalance the portfolio as deemed required by changes in market conditions.
LSWM obtains discretionary authority from clients in order to select investments
and execute transactions without permission from the client prior to each
transaction. LSWM generally limits its investment advice to equities, fixed income
and its own pooled funds. LSWM may make other investments as well to help
diversify holdings as deemed appropriate. Quarterly communication assures that
clients are kept abreast of their investments, as well as the LSWM’s investment
outlook and strategy.
Fund Management Services
LSWM acts as the adviser to three Canadian-based funds, namely the Steinberg
High Yield Fund, Steinberg Global Value Equity Fund and Steinberg Canadian
Dividend Growth Fund. While these funds are not currently open for direct
investment by U.S. investors, LSWM utilizes the investment strategy for the
Steinberg Global Value Equity Fund and the Steinberg Canadian Dividend Growth
Fund in managing separately managed accounts for U.S. clients. Below is a brief
description of these three Canadian funds.
Steinberg Global Value Equity Fund
The Steinberg Global Value Equity Fund seeks to provide long-term capital
appreciation by investing in public companies that meet our strict investment
criteria, and whose share price is trading at a discount to its intrinsic value.
LSWM’s research efforts for the fund are driven by the following principles:
• Bottom-up fundamental equity research
• Invest only in companies that are financially sound and generate free cash
flow
• Focus on strong management and good
corporate governance
• Diversify broadly across issuers and industries
Steinberg High Yield Fund
The Steinberg High Yield Fund seeks to maximize total return by investing
primarily in higher yielding corporate bonds and other securities. Our approach to
the high yield market is consistent with the conservative, value–based investment
philosophy that defines LSWM.
LSWM’s research efforts for the fund are driven by the following principles:
• Bottom-up fundamental credit research
• Focus on higher quality, non-investment grade bonds
• Total return, not just income
• Diversify broadly across issuers and industries
Steinberg Canadian Dividend Growth Fund
The Steinberg Canadian Dividend Growth Fund seeks to achieve long-term total
returns consisting of long-term capital appreciation, and regular dividend income
by investing in common and preferred shares of major Canadian companies.
LSWM’s research efforts for the fund are driven by the following principles:
• Bottom-up fundamental equity research
• Focus on high quality Canadian dividend paying companies
• Focus on dependable dividend income with a history of growing dividend
yields
• Diversify broadly across issuers and industries
LSWM may serve as the investment adviser to one or more U.S. private funds in
the future. This Brochure should not be considered an offering document for any
funds, and investors should refer to a specific fund’s offering memorandum or
organizational documents for a complete description of that fund, including its
types of investments and strategies, risks, conflicts of interest, fees and expenses.
We tailor our investment advisory services for a fund to such fund’s overall
investment program, and not to the needs of any underlying investor therein. The
governing documents for the fund and/or the investment advisory agreement, if
applicable, govern LSWM’s advisory services provided to a fund. The governing
documents of any U.S. private fund will likely provide that the fund may be
dissolved upon LSWM’s dissolution or the investment adviser’s resignation or
withdrawal from the fund. Any U.S. private funds will likely be designed to be
exempt from registration as an investment company under either Section 3(c)(1) or
3(c)(7) of the Investment Company Act of 1940, as amended (the “Company Act”).
Financial Services
LSWM offers various financial planning services to its separately managed account
clients free of charge upon opening an account.
Allocation Policy
LSWM seeks to ensure that investment decisions are made in accordance with the
fiduciary duties owed to its accounts and without consideration of LSWM’s
economic, investment or other financial interests. To meet its fiduciary obligations,
LSWM attempts to avoid, among other things, investment or trading practices that
systematically advantage or disadvantage certain clients. Accordingly, LSWM’s
policy is to seek fair and equitable allocation of investment
opportunities/transactions among its clients to avoid favoring one client over
another over time.
C. Client Tailored Services and Client Imposed Restrictions
In connection with its traditional investment advisory services, LSWM offers the
same suite of services to all of its clients. However, specific client investment
strategies and their implementation are dependent upon the client’s Investment
Policy Statement. Clients may, for instance, impose restrictions in investing in
certain securities or types of securities in accordance with their values or beliefs.
However, if the restrictions prevent LSWM from properly servicing the client’s
account, or if the restrictions would require LSWM to deviate from its standard
suite of services, LSWM reserves the right to end the relationship.
D. Assets Under Management
LSWM has the following assets under management:
Discretionary Amounts Non-discretionary Amounts Date Calculated
$592,705,945 $0 December 31, 2023