Treacherous markets fuel boom in outsourcing investment teams
Sign up to myFT Daily Digest to be the first to know about Investments news.
The market for outsourced investment teams is “red-hot” thanks to the darkening outlook for future returns, with allocators of capital increasingly delegating entire multibillion-dollar mandates to outside money managers.
Big corporate or public pension plans, endowments and foundations usually have in-house investment divisions, and only hand out specific mandates to external money managers.
However, smaller entities lacking the scale to employ expensive internal investment teams often outsource the entire management to investment consultants such as Mercer or asset managers such as BlackRock, which have specialist “outsourced chief investment officers”, or OCIOs.
The OCIO industry is now growing in size and scope, as bigger companies and institutions outsource…