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Making effective and outcome-oriented investment decisions requires deep knowledge in many areas. Only economic or financial education is not enough, because investors need to know in detail all the legal aspects of investments in different countries, monitor the political and geopolitical situation, etc. To meet these challenges for a competent approach to investment placement, the financial industry has set the trend for outsourcing advisory services to different types of clients.
The Outsourced Chief Investment Officer (OCIO) can help companies and organizations decide on wise investment allocation in today’s volatile market environment. Possessing comprehensive knowledge, wide experience, and professional expertise, companies providing services of this type successfully manage the entrusted to them capital. In their decisions, they prioritize the objectives of the clients but, at the same time, take into account all aspects of the economic and political situation to maximize profit from investments.
Mission and Functions of Outsourced Chief Investment Officer
Sometimes, organizations lack market insight for successful investment placement, and sometimes — knowledge or experience. All this can be provided by the Outsourced Chief Investment Officer, whose main mission is to ensure the financial well-being of their clients through investment consulting and OCIO investment portfolio management. The functions of the OCIO provider include the fulfilling of the following tasks:
- Choosing strategies and making investment decisions;
- Analyzing risk factors and conducting competent risk management;
- Asset allocation and investment portfolio management;
- Monitoring, analyzing, and reporting the performance of investment strategies;
- Providing institutional due diligence;
- Ensuring regulatory adherence and compliance with all requirements.
Types of Clients that Can Benefit from OCIO Services
Complex investment strategies require an integrated approach, and even large companies may not have enough specialists who could ensure a complete cycle of investment portfolio management. Therefore, OCIO providers offer their services to the most diversified set of clients who need professional knowledge to manage their finances:
- Business companies and corporations;
- Nonprofit organizations;
- Family and multi-family offices;
- Institutional investors.
Advantages of the OCIO Model Over Traditional Investment Placement Methods
To understand why the OCIO model has gained such popularity in recent years, it is necessary to compare the traditional way of building and managing an investment portfolio for corporate and institutional clients and delegating these functions to OCIO.
| Indicators | Traditional Methods | OCIO Model |
| Costs | The necessity to hire an in-house team of specialists and pay them market-competitive salaries on a regular basis | Providing clients with a devoted professional team that is paid only for the tasks fulfilled |
| Expertise | Narrow expertise due to providing services just for one organization or business | Broad expertise and comprehensive knowledge due to the necessity to face investment tasks for different types of clients |
| The swiftness in making decisions and implementing investment projects | Delayed decision-making due to the need to coordinate all decisions with the board of directors or other leadership structures | Fast decision-making and execution due to the fact that these functions are delegated to OCIO |
| Investment opportunities | Investment alternatives may be limited due to account minimums, which puts smaller companies at a disadvantage. | The use of additional investment vehicles expands the palette of possible investment alternatives even for small companies |
Factors to Consider When Choosing an OCIO Services Provider
Due to the popularity and profitability of this sector of the investment industry, the entry of new providers into the OCIO services market is quite intensive. To make the right decision when choosing an OCIO firm, it is important to consider the following factors:
- Number of years of providing services in this or related field;
- Adhering to a whole-portfolio investment approach;
- The level of expertise of the team and the number of successfully implemented projects;
- Possibility to choose between different OCIO model architectures: closed/open and full/partial;
- Transparency of all investment portfolio management processes;
- Open, honest, and detailed communication with clients;
- Good reputation among current and former clients;
- Modest OCIO provider’s fees.
Get Certainty and Ingenuity from Certuity OCIO Provider
In over 20 years of serving clients in the investment industry, Certuity has gained not only vast experience and expertise but also the trust of customers and the appreciation of the company’s work. Among the advantages that allowed Certuity to become one of the leaders in the investment industry, users of the company’s services highlight the following:
- A holistic and collaborative approach that takes into account the needs, values, and goals of clients;
- Direct access and intensive communication with the investment team;
- Detailed analytics and timely adjustment of investment strategies based on performance results;
- Active market research for the most profitable investment placement;
- Providing access to alternative investments;
- Transparent pricing and no hidden fees.
By choosing Certuity OCIO service, you will get the highly professional management of the investment portfolio of your organization, making the most optimal, thoughtful, and promising decisions, comprehensive communication with the team, and other components of effective and long-term cooperation. Customized and risk-aware solutions for each client allow placing investments not only in the most profitable way from a financial point of view but also taking into account the values, mission, and priorities of your company or organization.
