A growing trend across many industries that seems here to stay is the increasing client demand for custom, personalized solutions. Cookie-cutter services based on models and templates don’t work like they have in the past.
As an RIA, you understand no two clients are exactly alike. Each person or couple has their own situation: Asset amounts, timelines, savings and distribution rates, tax considerations, risk tolerances, and goals.
So, a ‘one-size-fits-all’ approach to investment management is not appealing and may be unappealing for most clients. As a result, this poses a real challenge for busy RIAs, who have several responsibilities in addition to managing custom portfolios for clients.
The solution lies in partnering with an Outsourced Chief Investment Officer (OCIO) firm like Cornerstone Portfolio Research that prioritizes custom solutions for RIA clients. By collaborating with an OCIO provider, your RIA/IAR can gain access to tailored investment solutions for each of your clients.
All 50-year-olds are not the same. Cornerstone understands that a successful investment strategy isn’t built on a cookie-cutter template or model; it’s meticulously crafted with the individual client in mind.
However, before diving into the benefits of customization, let’s explore some of the limitations of one-size-fits-all investment management for RIAs.
The Challenge of Generic Models for Investment Management
Generic investment strategies might seem efficient at first, but they often don’t meet the diverse needs of each individual client. Here’s why a one-size-fits-all approach can hinder performance.
Firstly, it has a limited ability to address varied risk tolerance. Clients can range widely from older conservative investors focused on preserving capital to younger aggressive individuals seeking maximum growth. Generic strategies are often based on a middle-ground asset allocation, failing to adequately address the risk tolerance spectrum based on a number of financial variables.
Secondly, it can result in missed opportunities within specialized strategies. Certain types of clients may benefit from alternative investments like private equity or hedge funds. Most generic strategies do not incorporate these options, leaving untapped potential.
Generic solutions may have a problem up with client requirements. For example, age is not the only criterion for risk tolerance. Timelines to retirement, tax situations, and personal investment preferences can all play a crucial role in portfolio construction. A generic approach might overlook these nuances, potentially leading to higher taxes or dissatisfaction with a diversification strategy.
Cornerstone’s tailored OCIO solutions are designed to overcome these limitations and unlock the power of custom portfolios, helping you deliver exceptional client experiences.
Cornerstone’s Tailored OCIO Solutions
Cornerstone Portfolio Research approaches OCIO services with a core emphasis on customization. Here’s how we collaborate with RIAs to craft personalized investment strategies:
Collaborative approach: We believe in fostering strong relationships with our RIA partners. We’ll work with you to gain a comprehensive understanding of your firm’s preferences, your investment philosophy, performance expectations, and risk parameters. Then Cornerstone can tailor solutions that align seamlessly with your current wealth management strategies.
Tailored asset allocation: We meticulously craft asset allocation strategies for each individual client portfolio, considering their unique risk profile, timelines, and financial objectives. Our process is tax-efficient whenever we recommend changes. And, each client portfolio is positioned to pursue their desired rate of return while managing risk within their comfort zone.
Integration of specialized strategies: The investment landscape offers a wealth of specialized options beyond traditional stocks, bonds, and cash equivalents. Cornerstone can seamlessly integrate alternative investments, Environmental, Social, and Governance (ESG) investment strategies, and other specialized approaches that align with specific client needs and goals. This allows you to unlock opportunities for enhanced returns and cater to clients focusing on sustainable or impact investing.
Ongoing communication and review: Financial markets are dynamic, and client needs evolve over time. We prioritize ongoing communication with our RIA partners, providing high-level updates weekly. We offer virtual meetings with you and your clients as needed and schedule regular portfolio reviews to keep our strategies aligned with each client’s goals and risk tolerance.
By partnering with Cornerstone Portfolio Research, you gain access to a comprehensive suite of OCIO services that can deliver custom solutions to your clients.
Benefits of Customization
Here’s how a personalized investment experience for your clients is a win-win situation:
- Enhanced client satisfaction: When clients feel their unique needs and preferences are understood and addressed, their satisfaction will naturally increase. Customization demonstrates a commitment to exceeding individual expectations.
- Optimized portfolio performance: Tailored strategies can potentially generate better returns based on specific client risk profiles. By moving away from a generic approach, optimal asset allocation, portfolio enhancements, and access to more investment options increase the potential for achieving desired outcomes.
- Stronger client retention: Clients who receive personalized attention are more likely to remain with your firm long-term, reducing client turnover and enhancing your firm’s stability and future growth.
- Competitive differentiation: In today’s competitive wealth management market, custom solutions set you apart from competitors. Your research and investment models will be personalized for your clients, thereby avoiding cookie-cutter-type services.
- Referrals and growth: Satisfied clients are more likely to refer friends and family to your services. Offering customized solutions can boost your reputation and attract new clients through positive word-of-mouth, leading to business growth.
Cornerstone’s Commitment to Client-Centricity
Cornerstone Portfolio Research places the needs of our RIA partners and their clients at the forefront of everything we do. Our customized OCIO solutions are a testament to this core value-added approach.
With over 70 years of combined investment experience, Cornerstone offers sophisticated research and portfolio management services to RIAs and IARs, helping you efficiently manage your clients’ assets.
You’ll be working with a CFA Charterholder, a highly-regarded industry designation. You will also be more competitive against larger firms that have inhouse CIOs and investment professionals. We help you stand out in a crowded field.
We seamlessly integrate with all of your current investment strategies and services.
Cornerstone goes beyond simply managing assets; we strive to be a trusted partner in helping you scale your practice so you can focus your time on doing what you do best, for example, adding new clients and serving current clients.
Are you interested in exploring this growth opportunity? Schedule an introductory consultation here.
We are happy to provide a complimentary portfolio analysis tailored to a specific client segment within your RIA firm – pre-retirees, recent retirees, and business owners. This analysis will provide valuable insights into potential opportunities for improvement and demonstrate the power of custom services.
Contact us today at 484.631.3684 EDT and let’s start the conversation.
