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Investment outsourcing is the process whereby institutional investors and high-net-worth families engage a third party to manage all or a portion of their investment portfolio. This arrangement can include functions such as establishing the asset allocation, selecting investment managers, implementing portfolio decisions (both strategic and tactical), providing on-going oversight, performing risk management and other areas of portfolio management.

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  • Investment outsourcing (en)
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  • Investment outsourcing is the process whereby institutional investors and high-net-worth families engage a third party to manage all or a portion of their investment portfolio. This arrangement can include functions such as establishing the asset allocation, selecting investment managers, implementing portfolio decisions (both strategic and tactical), providing on-going oversight, performing risk management and other areas of portfolio management. (en)
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  • Investment outsourcing is the process whereby institutional investors and high-net-worth families engage a third party to manage all or a portion of their investment portfolio. This arrangement can include functions such as establishing the asset allocation, selecting investment managers, implementing portfolio decisions (both strategic and tactical), providing on-going oversight, performing risk management and other areas of portfolio management. Outsourced investment management is a large and growing market segment with over a trillion dollars currently managed by outsourced managers. According to a survey of outsourcers by aiCIO magazine, the volume of outsourced assets increased 200% between 2007 and 2011. The outsourcing trend began with smaller institutions that could not or did not want to build an internal investment team. According to a study by the Family Wealth Alliance, approximately four in ten wealthy families have outsourced discretionary investment authority. The trend is even clearer among families with less than $500 million in assets where two-thirds have outsourced management. Similarly, just 11% of college endowments between $100 and $500 million internally manage their portfolios and instead rely on outsourced managers. Increasingly, however, it is not just small investors seeking to outsource. There has been a marked increase in the number of multibillion outsourcing engagements since the 2008 financial crisis as firms grapple with increasing complexity and the need for better risk management. Investment outsourcing goes by many names including "fiduciary management", "outsourced chief investment officer", "outsourced CIO," "OCIO,", "CIO in a box," and "implemented consulting." (en)
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