An OCIO is the natural evolution of investment advice.  Our industry has gone from calling each client and getting permission to buy individual securities to calling each client to hire and fire a manager or mutual fund to being an OCIO with discretion.  Institutions, Pensions, HNW households, Family Offices and the Endowment Foundation market looking to lower costs, move to ETF’s, and improve net of fee results will continue to grow the OCIO market.  The minimum check list to hire an OCIO:

  1. Being a Fiduciary – Act in clients best interest
  2. An independently audited track record of returns, “net of fee” – Why would you hire someone without a proven track record?
  3. Investments are held by a major custodian (i.e. Fidelity) – Firm that produces the statements and safe keeps your assets.

Advantages of hiring a OCIO are: lowering investment cost (you keep more); easy to change OCIO’s ; reduce overhead (head of investments, gatekeeper, investment consultant); no more blaming the investment manager; portfolio manager or staff; and no need to pay, manage and supervise a whole investment office’s HR, operations, technology, security, space and PEOPLE.

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