The present investment niche has already become so challenging and complicated that many US companies started to have serious problems with managing their investment portfolios effectively. However, even in this difficult situation, there is also a way out. An Outsourced Chief Investment Officer (OCIO) can solve such problems owing to a solid expertise in this field. Have you ever heard of such experts? In this post, we are going to explain who OCIOs are and discuss how they can help companies achieve better investment results.
Who is the Outsourced Chief Investment Officer?
An Outsourced Chief Investment Officer is a single professional or a company that provides comprehensive investment management services to corporations, endowments, various sorts of enterprises, foundations, etc. These organizations hire a professional OCIO to oversee their investment strategy, portfolio construction, and ongoing management rather than relying solely on an in-house investment team. For example, Certuity Company has long-term experience in providing Outsourced Chief Investment Officer services. That is why the services of this company are constantly in demand in the market of quality investment services
Types of OCIOs
Various types of OCIOs operate in the US investment market. They offer a variety of levels of services and have dissimilar specializations. However, we can distinguish the most common OCIOs types that currently provide services in the United States. Please, check out the table below.
| Type of OCIO | Responsibilities |
| Full-service OCIO | These OCIOs provide end-to-end investment management services. They supervise a client in asset allocation, strategy development, risk management, manager selection, and ongoing monitoring of all processes in the company. Full-service Outsourced Chief Investment Officer provides a comprehensive solution and deals with investment-related responsibilities on behalf of the client. |
| Partial OCIO | This type of Outsourced Chief Investment Officer works only with specific areas of investment management. In this case, the client organization controls other aspects. Partial OCIOs may deal with definite asset classes or investment strategies. |
| Boutique OCIO | Boutique OCIOs are specialized firms that work only with specific niches or industries. As a rule, they have tremendously deep expertise in a particular investment strategy. Boutique OCIOs can offer niche companies professional solutions that correspond to their unique needs. |
| Generalist OCIO | This OCIO type provides services to a variety of clients across industries. Generalist OCIOs deal with customization in designing investment strategies to satisfy the individual needs of each client. |
| Hybrid OCIO | Hybrid OCIOs combine elements of both in-house and outsourced investment management. As a rule, they closely cooperate with a client’s internal investment team, provide specialized expertise, and fill gaps in certain knowledge or resources. |
It should be noted that each type of OCIO brings its set of benefits and drawbacks. Consequently, before hiring a certain OCIO type, companies should carefully evaluate their investment needs, goals, and resources so that such cooperation brings investment success.
How an Outsourced Chief Investment Officer can help companies achieve better results
Professional OCIOs, like LLC Certuity, have various sets of effective tools to help various types of companies achieve great investment results. Alongside this, hiring a professional OCIO also brings plenty of benefits to companies. Let us go over the most effective ones.
Firstly, hiring an OCIO saves company`s money. When companies hire an OCIO, it can be a cost-effective solution for them. Instead of keeping an in-house investment team, which incurs significant expenses regarding salaries, benefits, and infrastructure, companies can effectively use the OCIO for a fraction of the cost. This allows corporations to access high-quality investment management without spending much money connected with their internal teams.
Secondly, OCIOs provide companies with specialized expertise. OCIOs bring extensive expertise in investment management. They always stay updated on promising investment strategies, market trends, and regulatory changes. In this way, the Outsourced Chief Investment Officer provides its clients with insightful advice to create a robust wealth management strategy. Hence, such specialized expertise helps companies fully optimize their investment strategies and potentially get great investment returns.
Thirdly, companies can get access to leading investment managers. A professional Outsourced Chief Investment Officer always has extensive networks and relationships with the most influential investment managers across various niches. Cooperating with such OCIOs, companies will gain access to these investment managers who may not be available to them without OCIOs. Consequently, this access opens doors to a broader range of investment opportunities and significantly boosts the potential for superior investment results.
Fourthly, an OCIO saves time for companies. When a company outsources its investment management responsibilities to an OCIO, it can focus on its core strategic objectives. When companies delegate their key investment decisions to experts, they immediately free up precious time and resources that can be redirected towards such critical areas of the business as growth initiatives or client service.
Finally, an OCIO helps companies deal with risk management. The Outsourced Chief Investment Officer’s solid expertise in risk management can help companies perfectly manage the complexities of investment risk. OCIOs conduct systematic due diligence, implement risk mitigation strategies, and monitor investment portfolios closely. That is why they can help save capital, manage all possible downside risks, and fully protect companies’ financial interests.
Pros of hiring an OCIO:
- Optimizes investment portfolios;
- Implements sophisticated investment strategies;
- Manages risk effectively;
- Enhances investment decision-making processes;
- Maximizes returns while controlling costs;
- Responds quickly to changing market condition;
- Frees up internal resources for core business activities.
Final words
Now, you see why the role of Outsourced Chief Investment Officers has already become progressively more crucial for US companies that need to optimize their investment strategies and achieve better results. Using their specialized expertise and having direct access to leading investment managers, OCIOs greatly help companies deal with risk management, cost efficiency, enhanced returns, and time savings. That is why specialists in such a profession can now be considered truly indispensable.
