Firm Description
Optima Asset Management, Inc. (“Optima””), was founded in 1995 with registration granted by the U.S.
Securities and Exchange Commission on July 12, 1996. In granting registration, the U.S. Securities and
Exchange Commission has not verified or approved the information contained herein.
Optima operates as a non-discretionary, fee only, master investment advisory, and consultancy service.
The term “master investment adviser” or “master investment advisory” is used to describe the “primary”
client advisory relationship when one or more sub advisers are engaged, as a result of recommendations
by the master investment adviser, to manage specific investment style objectives or asset classes within
the framework of a client’s overall portfolio.
The firm manages clients’ portfolios on an individualized basis. Clients may impose restrictions or
requirements to exclude or hold specific securities. The firm does not sponsor any wrap programs. As of
December 31, 2023, the firm managed assets on a non-discretionary fee only basis totaling $599,035,873
in 297 individual accounts.
Investment Advisory Services
Optima will undertake a detailed survey of each prospective investor’s investment objectives including
return expectation, risk tolerance, and investment horizon. The information will be used in drafting an
Investment Policy setting forth the prospective investor’s objectives.
The information provided in the Investment Policy will be used as the basis for the construction of a
“mean efficient”, statistically optimal portfolio from among the available asset classes suitable for the
investor. Portfolios constructed in this manner will be designed to target the investor’s expected return
and risk tolerances over the specified investment horizon.
Optima employs advanced software products and proprietary models to interact with the prospective
investor. These tools help facilitate an instructive process targeting the needs of the prospective investor
while allowing them to view the proposed portfolio’s behavioral characteristics based on their investment
objectives.
Once an appropriate asset class mix has been determined and the investor has made a decision to engage
the investment services of Optima, Optima will undertake the assembly and construction of a portfolio
consisting of individual asset classes that most closely approximate the “allocation decision”. The
securities utilized and the allocation employed will be largely dependent on the client’s investment
objectives and the amount of the funds available for investment. A typical client’s portfolio may include
mutual funds, exchange traded funds (ETFs), sub advisory relationships and, in some cases, securities as
may be directed by the client. Investment securities recommended for inclusion in the portfolio mix will
be those which provide the highest unit of return per unit of risk assumed by the investor, and that which
most closely approximates the statistical characteristics of the asset mix the client has determined
appropriate.
To determine which investment securities might qualify for inclusion, Optima does extensive quantitative
analysis, research, testing, and evaluations of risk and returns. Optima relies on advanced mathematical
techniques such as linear regression, mean variance optimization, factor and style analysis, and
performance attribution pioneered by Nobel Laureates in Economic Sciences William Sharpe, Harry
Markowitz, and Eugene Fama for the identification of appropriate securities for investment. This
approach is referred to as Modern Finance or Modern Portfolio Theory. The Theory holds that a portfolio
diversified across multiple asset classes offers the best opportunity for an investor to achieve the highest
possible return for a given level of risk.
Optima employs a low turnover, tax efficient investment strategy based on the assumption market timing
has not proven successful for most investors.
As a fee-only investment advisory firm, the firm
does not sell or offer annuities, insurance, stocks, bonds,
mutual funds, exchange traded funds (ETFs), limited partnerships, or other investment products which
might result in monetary and non-monetary compensation payable to the firm, its employees or officers.
Once the funds and/or managers to be utilized have been identified, Optima oversees all aspects of the
engagement process and the investing relationship, assisting with implementation where sub advisers
are involved, negotiating commissions and fees where appropriate, and in arranging custodial
relationships as necessary.
Optima provides ongoing due diligence and performance evaluations on all investments on behalf of the
client. Performance is compared to the asset class benchmark it is intended to represent in the model
portfolio representing the client’s targeted asset mix. Recommendations for changes are made when the
performance of the fund and/or sub adviser varies statistically with the asset class benchmark. The
determination of a significant statistical variance triggering a recommendation for liquidation or
replacement of a fund, or the termination of a sub adviser relationship is determined by the Investment
Committee and may vary from one asset class to the next. In addition, Optima provides rebalancing
recommendations to ensure the portfolio performs as expected.
Clients are provided detailed performance reports following the close of each calendar quarter comparing
their individual total portfolio’s returns to a range of asset class benchmarks.
Financial Planning Services
The Adviser offers limited financial planning services, as an additional service to our clients. Any financial
planning services provided to investment management service clients will be included in this advisory fee.
The type of planning and level of detail varies depending on the client’s objectives. In general, the financial
plan may address any or all of the following areas of concern:
• Personal: Review family records, budgeting and debt management, personal liability, estate planning
and financial goals.
• Tax and Cash Flow: Analyze the client’s income tax and spending and planning for past, current and
future years. The impact of various investments on the client’s current income tax and future tax
liability may be illustrated.
• Investments: Analyze investment alternatives and their effect on a client’s portfolio.
• Death and Disability: Review the cash needs at death, income needs of surviving dependents, estate
planning and disability income analysis.
• College Planning: Review of escalating college costs and analysis of alternative strategies to best help
the client accomplish his plans for college funding.
• Retirement: Analysis of current strategies and investment plans to help the client achieve his
retirement goals.
Adviser gathers required information through in-depth personal interviews. Information gathered
includes client’s current financial status, future goals and attitudes towards risk. Adviser is not required
to verify any information received from the client or the client’s other professionals. It is the responsibility
of the client to promptly notify the Adviser if there is ever any change in their financial situation or
investment objectives. Adviser will rely on this information when preparing a written report for the client.
Implementation of the plan recommendations is entirely at the client’s discretion.
Clients are encouraged to engage other professionals such as attorneys, accountants, insurance agents,
and others in their area specialization as appropriate to assist them.
Principal Owners
Paul Lightfoot and Archie Ponce are the principal owners. Paul Lightfoot is President and Chief Executive
Officer of the firm and Archie Ponce is Executive Vice President and Chief Compliance Officer. The firm is
not publicly owned or traded. There are no indirect owners or intermediaries who have any ownership
interest in the firm.