Empowering your Foundation’s investment strategy
As nonprofits attempt to balance the responsibilities of their core mission with an increasingly complex investment landscape, the need for a dedicated, third-party asset manager has never been more pressing. Whether you already have a broad and diverse investment portfolio, or you are a nonprofit looking to invest in the market, working with an outsourced CIO (OCIO) can help improve governance, help manage risk, and potentially lower costs.
Through Avidian Wealth Solutions’ outsourced CIO offering, organizations from a variety of industries can trust that their financial goals are being handled with the utmost fiduciary care. Our OCIO offering provides you with all of the benefits of professional investment management without the financial burden of hiring and maintaining an in-house investment team.
Billion in client assets under management *
*AUM based on AWS current FORM ADVFinancial professionals
Years of success
What is an outsourced CIO, exactly? Simply put, it is a service that allows organizations to delegate the management of their investment strategies to a third-party firm, freeing organization leaders from the day-to-day tasks and time-consuming decision-making that comes with any long-term investment strategy.
At Avidian Wealth Solutions, our primary objective when operating in the capacity of an OCIO is to forward the financial goals of our clients in the following ways:
At Avidian, we collaborate closely with institutions to craft a tailored asset management strategy that aligns with their unique needs, risk appetite, and investment goals. Our strategic approach is designed to optimize the risk-return profile of the portfolio over the long haul, planning for sustained growth and stability.
In addition to our long-term strategic approach, Avidian offers tactical allocation solutions aimed at capitalizing on perceived market mispricing and identifying enduring themes that could drive superior performance throughout a market cycle.
Through meticulous due diligence, Avidian selects external investment managers that aim to seamlessly integrate with the institution’s investment vision. We continuously monitor and assess the performance of these managers, swiftly adjusting strategies as needed to uphold peak portfolio performance.
Avidian is dedicated to helping institutions navigate and mitigate investment risks effectively. From analyzing market dynamics to evaluating geopolitical influences, we leave no stone unturned in identifying potential risks. Our goal is to implement robust risk management strategies that safeguard the organization’s assets and maintain volatility within predefined limits.
Institutions often grapple with unique cash flow requirements and predictable liabilities. Avidian has experience in tailoring investment solutions that precisely match these needs, taking into account factors such as liquidity demands, expenditure policies, and the overarching mission of the organization. Avidian advises on optimal spending policies by providing rigorous analytics and guidance to help Boards make informed decisions on how they should spend or allocate distributions from a portfolio. This can help preserve the long-term sustainability of an organization while supporting the mission.
Avidian takes compliance seriously, ensuring adherence to regulatory standards and the specific mandates outlined by bodies like UPMIFA for non-profits. Our comprehensive reporting mechanisms offer transparent insights into the performance and positioning of the investment portfolio, empowering organizations to fulfill their fiduciary duties with confidence.
As part of Avidian’s holistic OCIO offering, our advisory team conducts a thorough review of an organization’s Investment Policy Statement (IPS) at the start of a new relationship. Alternatively, for organizations that do not have an IPS in place, Avidian can help create one. We consider this an important onboarding step to create and maintain a roadmap for investment discipline, accountability, and risk management.
A well-structured IPS provides codified guidance to investment advisors, investment committee members, and an organization’s leadership team on a variety of key topics, including:
This document serves as a critical frame of reference between an organization and the advisory team. As part of our ongoing partnership with clients and our disciplined approach to our advisory role, we recommend reviewing this document on a periodic basis.
An Outsourced Chief Investment Officer provides specialized assistance tailored to the unique needs of endowments and foundations, distinct from other institutions. OCIOs help navigate the intricate landscape of investment opportunities, considering factors like mission alignment, spending policies, and donor expectations. They offer guidance in strategic asset allocation, aligning investments with long-term objectives while ensuring compliance with fiduciary responsibilities.
Additionally, OCIOs handle manager selection and monitoring, working to reduce the burden on internal staff. By offering personalized solutions and nimble decision-making, OCIOs empower endowments and foundations to optimize portfolio performance, mitigate risks, and fulfill their financial stewardship duties efficiently.
For nonprofits, an OCIO provides personalized support that addresses the unique challenges of managing investments. Nonprofits often face constraints like limited resources and diverse stakeholder expectations. OCIOs offer strategic guidance in asset allocation, considering risk tolerance and organizational objectives to optimize returns. They assist in manager selection and monitoring, working towards alignment with the nonprofit’s mission and financial goals.
By outsourcing investment management responsibilities, nonprofits can focus on their core activities while benefiting from professional oversight and streamlined decision-making processes, ultimately enhancing their ability to fulfill their mission effectively.
For healthcare systems, OCIOs can provide specialized expertise to match the unique financial landscape of the healthcare industry. Unlike other institutions, healthcare systems must navigate complex regulatory environments, changing reimbursement models, and evolving patient care needs. OCIOs offer strategic asset allocation aligned with healthcare-specific risk profiles, considering factors such as reimbursement cycles and capital expenditure requirements. They assist in selecting investment managers attuned to healthcare trends and regulatory compliance, optimizing portfolio performance while safeguarding assets.
By outsourcing their investment strategy, healthcare systems can focus on delivering quality care while leveraging the OCIO to navigate financial complexities effectively.
Our team is comprised of highly credentialed, specialized, and experienced wealth management professionals who work together to handle multiple aspects of your financial life, including asset management, debt management, risk management, taxation, wealth transfer, and more.
CFPs
CFAs
MBAs
JDs
PhD
CEPAs
OCIOs are asset managers, but unlike traditional consultants, who only have the ability to advise on investment decisions, OCIOs can execute on those investments. Like any internal chief investment officer, an OCIO has fiduciary responsibilities to an organization and therefore has a legal duty to operate in the client’s best financial interest. Additionally, Avidian’s OCIO solutions offer end-to-end services, reduce administrative burdens, and streamline operations.
Outsourced CIO services are typically best for nonprofit organizations (e.g. healthcare systems, religious institutions, higher education providers, etc.), endowments and foundations, corporations, private pension funds, and other organizations.
Benefits of working with an OCIO include, but are not limited to the following:
The OCIO selection process involves assessing an organization’s specific needs, market insights, and operational constraints. Charitable organizations increasingly consider OCIO models due to the complexity of modern markets and the need for nimble decision-making.
While an OCIO offers professionalism, access to expertise, and streamlined decision-making, organizations must weigh considerations such as ceding operational control and potential additional fees. Clear delineation of roles between the organization and the OCIO, along with a thorough understanding of the OCIO’s service offerings, are crucial for successful implementation.
Yes. Organizations can choose to delegate some or all of their investment strategy to an outsourced CIO; that said, leadership maintains control over important decisions like asset allocation, while the OCIO focuses on the day–to–day management duties.
OCIOs report performance by establishing relevant benchmarks aligned with the organization’s investment objectives. These benchmarks can be absolute, relative, or risk-adjusted. Key performance indicators (KPIs) such as returns, risk, cost, and compliance are used for evaluation.
Conducting regular reviews involves examining both quantitative and qualitative aspects, including communication, responsiveness, and adherence to the investment strategy. This comprehensive approach ensures transparency, trust, and alignment between the organization and the OCIO regarding investment decisions and strategies.
Curious about where you stand today? Schedule a meeting with our team and put your portfolio to the test.*
