Unlike the geographic landscape, the investment one changes very quickly, especially in situations of crisis and uncertainty. This became especially evident during the global crisis of 2008/09, which created a demand for the services of the Outsourced Chief Investment Officer (OCIO). It was this investment model that helped save the capital of many companies and organizations and, therefore, gained well-deserved recognition and widespread popularity.
Today, the financial, economic, and geopolitical conditions in the world also do not promise certitude and serenity in the near future. In this situation, only the high professionalism of the Outsourced Chief Investment Officer and their subtle business and financial flair can ensure the protection of investments from unpredictable waves of the global market. Moreover, their ability to see through the veil of sharp market fluctuations and their flexibility in applying investment strategies provide a significant capital increase. With OCIO Services from Certuity, you get the most efficient and robust performance of all your investments and wide prospects for bigger projects.
Can a Company Become Successful Without Investment Management?
Any business or organization has assets that provide capital gains. Even if it’s just a room in which you are meeting with clients for consultations, this is the asset that allows you to make money. Successful projects are distinguished by the ability to accumulate free assets. However, if they are not invested in additional projects, they lose their value due to inflation or other adverse factors. For example, if some non-profit organization owns unused premises, they simply deteriorate and not only do not bring any income but also require constant repair. Therefore, the issue of investing is one of the key ones for both business companies and non-profit organizations with various missions.
What Caused the Transition from CIO to OCIO
Before the widespread proliferation of the OCIO model, the issue of investment management in mid-sized and large organizations and companies was dealt with by a very large group of people:
- Qualified in-house staff
- Chief investment officer (CIO)
- Non-discretionary adviser or consultant
- Board committee
This cumbersome structure proved to be very inefficient in the face of the 2008/09 financial crisis and the need to respond very quickly to changing conditions. The highly professional, flexible, versatile, and experienced staff of OCIO services turned out to be much more efficient and ready for non-standard solutions.
Metaphorically, this can be compared with the behavior of a car driver and a cyclist or a motorcyclist in a traffic jam: where the second one quickly sees the solution and gets to the goal, the first one is constrained to patiently wait for the natural course of events. Comparison of the CIO and OCIO models by objective indicators shows the obvious advantages of the second one:
| Factors | CIO Model | OCIO Model |
|---|---|---|
| Applicability | Suitable for mid-sized and large organizations | Suitable for organizations and companies of any size, including small ones |
| Staff costs | Huge and permanent | Moderate and only for work performed |
| Performance | The return on investment is low and unstable due to the rather narrow experience of in-house specialists | High performance due to extensive experience and continuous improvement of OCIO |
| Compliance with fiduciary obligations | Problematic due to the large circle of people involved in decision-making | A transparent pricing policy for OCIO services guarantees compliance with fiduciary obligations |
| Flexibility in decision-making | Reluctance to innovative and original solutions due to inertia, group-think, and passing the initiative to others | Willingness to consider non-trivial solutions if the probability of a positive result is high enough |
As a result, the management of companies and organizations recognized that the net returns from maintaining their staff of investment specialists are not only minimal but sometimes unprofitable. At the same time, the OCIO services provided an impressive profit in comparison with the costs of the chosen tariff plan.
How to Determine the Most Efficient OCIO Contractor
It is necessary to select a company providing OCIO services as responsibly as to invest your money in a particular project. The advantages of OCIO are both in non-standard solutions and experience, so both of these conditions must be met:
- A promising start-up with employees full of enthusiasm and original ideas without sufficient work experience will lead to many reckless decisions.
- At the same time, the conservative and formulaic approach of specialists who do not want to keep up with the times will not allow them to find effective solutions and see the unique opportunities offered by the new epoch.
Therefore, when choosing an OCIO contractor, it is important to conduct an in-depth analysis of candidate firms and evaluate the following indicators:
- Educational background and work experience of specialists;
- Successful track records;
- Best practice adherence;
- Presence/absence of conflicts of interest;
- Transparency of the pricing policy;
- Customer reviews.
Benefits of Outsourcing CIO with LLC Certuity
- The investment management expertise of LLC Certuity is backed by over 20 years of experience in family office wealth management and investments, including alternative ones.
- Knowledge of effective risk management techniques guarantees the protection of your assets from market fluctuations and provides both short-term and long-term profits.
- The openness, transparency, and collaborative approach of LLC Certuity assure the possibility of proper oversight and timely correction of all actions in case of changes in investment goals.
- Direct access not only to the team managing your investments but to your assets as well ensures that you always have the last word.
- The high-performance indicators are the best proof that all decisions are professional and made solely in favor of clients.
Strategic asset allocation in the conditions of unstable markets is an extremely challenging task, for which professionalism and the ability to look into the future are crucial. The high reputation of Certuity and two decades of successful investment management is the best proof that even the most intense fluctuations in financial markets can be conquered by a well-designed investment strategy and the strong knowledge of those who control the helm.