Welcome
ANOVA Management’s mission is to help investors pursue their long-term goals through a disciplined, risk-aware investment process. Based in Texas, New York and Florida, we specialize in working with investors who recognize that risk management and a disciplined process are important components of an investment strategy.
In 2021 the book, Moving Beyond Modern Portfolio Theory: It’s About Time!, was published by Lukomnik and Hawley to address what they call “the MPT paradox”: in which they point out that Markowitz’s MPT diversification works only to mitigate idiosyncratic risks, which are specific to certain assets or industry sectors—and does nothing to mitigate systematic risks, which could collapse the entire financial system.
Our Philosophy
ANOVA Management developed its trading program Efficient Market Portfolio Plus (EMP+) to address these concerns for equity investors. EMP+ seeks to address the idiosyncratic risk of individual securities by investing in a broad sampling of companies. It seeks to reduce exposure to industry sectors that ANOVA’s proprietary algorithms identify as potentially underperforming the broader market. EMP+ also seeks to reduce systemic (market) risk by pairing long positions in sectors the algorithms favor with short positions in sectors the algorithms disfavor. This hedging approach is intended to reduce, but cannot eliminate, the effect of broad market declines. The algorithms’ assessments may be wrong: long positions may decline, short positions may rise, and short selling can produce losses greater than the amount invested in a position. Hedging also involves costs and may cause EMP+ to underperform the market, particularly in rising markets.
Strategies
Our program and strategies – EMP+ is a diversified, actively managed investment program that seeks long-term growth while aiming to manage risk. There is no guarantee that EMP+ will achieve its objectives, and it may underperform the S&P 500 Index.
EMP L Financial Strategies
EMP L is designed for aggressive investors willing to accept the risk of drawdowns similar to, or greater than, those of the S&P 500 Index. EMP L is designed to maintain market exposure broadly similar to the overall stock market and can experience substantial losses when markets decline. There is no guarantee EMP L will outperform the market; it may underperform, including for extended periods. Suitable investors will typically be in the process of building their retirement accounts and often plan on making additional contributions regularly for the next ten years or more.
EMP B Financial Strategies
EMP B is designed for conservative investors who prefer less volatility in their retirement account. EMP B places greater emphasis on hedging, which is intended to reduce, but not eliminate, the impact of broad market declines. Hedging involves trade-offs: EMP B may lag the market, potentially significantly, when stock prices rise; its hedges may not protect against losses in every declining market; and it can lose money in any market environment. Suitable investors typically are retired or expect to retire within ten years and wish to reduce the risk of a significant drawdown in their retirement savings.
About Us
ANOVA Management is a team of professional traders who have joined together to help investors pursue their long-term financial goals. We have developed the Efficient Market Portfolio Plus (EMP+) to provide investors with an alternative to traditional stock picking methodologies and the often recommended “Buy and Hold” strategy. EMP+ strategies are actively managed and seek to reduce holdings in industry sectors that ANOVA’s algorithms identify as potentially underperforming the S&P 500 Index (S&P). There is no guarantee that EMP+ portfolios will be less volatile than, or generate higher returns than, the S&P, and they may underperform it.
Our Team
Wayne Penello – Wayne Penello is the Founder, President, and Chief Executive Officer of ANOVA Management, Inc. He has over 40 years of experience trading, managing risk, and investing. Wayne developed the Performance Risk Management System (US Patent 7,822,670 B2) to give his corporate clients a disciplined framework to hedge their commodity price risk, and he founded the consultancy Risked Revenue Energy Associates. That consultancy’s business was unrelated to ANOVA Management’s investment advisory services. Wayne is the co-author of the book Risk Is an Asset, published by ForbesBooks. Wayne has a Master’s degree in Marine Environmental Sciences from the State University of New York at Stony Brook. He withdrew from their Ph. D. program with only a language requirement to complete, to become a floor trader on the New York Mercantile Exchange (NYMEX). During his almost 10 years as an independent trader, Wayne served the NYMEX as the Ring Chairman for Options Trading and headed both the Settlement and Floor Committees. Wayne left the NYMEX to advise, trade, and manage commodity price risk for major United States and European firms.
Wayne actively supports several community charities, including ARTS for Rural Texas, The Boys and Girls Club of Champion Valley, the Fayette County Community Foundation, The Round Top Festival Institute, and the Turtle Wing Foundation. In his free time, he enjoys golfing with his wife, Leslie, hunting, fishing, and managing cattle on his ranch in Texas.
John DiPlacido – John DiPlacido is the Chief Marketing Officer at ANOVA Management. He has owned and managed an independent energy brokerage company on the New York Mercantile Exchange for 25 years, serving clients in commodities and, more recently, the renewable energy space. He has been interviewed and quoted in various publications, including the NY Times, Wall Street Journal, LA Times, Houston Chronicle, Bloomberg, Fox Business News, CNBC, and CNBC Asia, amongst others. Media coverage does not constitute an endorsement of ANOVA Management or its services. John is very active in his community. He volunteers to teach and mentor children and teenagers in sports and finance as his hobby.
Robert (Bob) Coakley – Bob Coakley is the Chief Operating Officer. He brings over 35 years of experience in commodity and stock trading to ANOVA Management. He served as Chairman and CEO of COED Media Group, where he was the original angel investor and later took over day-to-day operations. Bob was a member of the New York Mercantile Exchange for over 20 years, where he owned and operated Win Futures Inc., a commodity-trading firm with 100 employees. He was elected to the Board of Directors twice for a total of 6 years and was integral in reopening the Exchange after the 9/11 attack. He held various leadership positions, including Chairman of the Floor and Settlement Committees, and served on dozens of committees. He earned a bachelor's degree in accounting and finance from Fordham University, was a four-year letterman, and was an All-American in swimming and water polo. He has been on the national board of Swim Across America for 35 years, where he founded the Hudson River and Florida Keys events and served as Treasurer for 32 years. He has contributed significantly to SAA's success, helping to raise over $100 million for cancer research. He and his wife, Lisa, reside in Florida. Bob has a 100-ton Master Captain's License and a PADI Master Scuba Diver Trainer Instructors rating. He enjoys fishing, diving, and underwater photography in his free time.
"To invest successfully over a lifetime does not require a stratospheric IQ, unusual business insights or inside information. What's needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding that framework."
Warren Buffett
ANOVA Management, Inc. is a registered investment adviser in the following States: Florida, New York and Texas. The Adviser may not transact business in states where it is not appropriately registered, excluded or exempted from registration. Individualized responses to persons that involve either the effecting of transaction in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Past performance is not indicative of future results.
Investing involves risk, including possible loss of principal. EMP+, EMP L and EMP B use short selling and sector-based hedging. Short positions can produce losses greater than the amount invested, hedges may not perform as intended, and hedging involves costs that can reduce returns. The strategies may underperform the S&P 500 Index or other benchmarks, including for extended periods, and there is no guarantee that any strategy will achieve its objectives. References to the S&P 500 Index are for comparison only; an index is unmanaged, reflects no fees or expenses, and cannot be invested in directly. For more information about ANOVA Management, Inc., including its fees, strategies and risks, see our Form ADV Part 2A and the SEC’s Investment Adviser Public Disclosure website at adviserinfo.sec.gov. Registration as an investment adviser does not imply a certain level of skill or training.