There are a wide range of investment outsourcing options available to advisors these days. Undoubtedly, the right one is out there for you and your clients. But why outsource?
Findings from a recent survey of advisors by AssetMark best sum up what we have been saying for years: “To achieve scale and growth, advisors must allocate their time and resources toward high-impact, high-value endeavors. Time spent in nurturing client relationships can generate more value than the time consumed in managing investments.”1
More than 50% of the advisors surveyed in the AssetMark study cited delivering better investment solutions to clients as one of the top three reasons for outsourcing investment management. And a whopping 80% of advisors said that better investment solutions mean greater oversight of portfolios.1 Given the tumult of the markets, this is not at all surprising.
Investment management takes a lot of time, and investment management in volatile markets takes even more time. There are only so many hours in a day, and if you are spending those hours researching and managing portfolios, then you are not spending time on your relationships with your clients or looking for new ones. And let’s face it, if you are still managing portfolios for your clients, then the better part of the last several years has been spent trying to navigate the markets and manage portfolios rather than on client-facing activities.
In early 2021, PGIM Investments undertook a study2 to look at trends in portfolio construction in the current investment environment. The study found that “stock market volatility remains advisor’s greatest concern for client portfolios” and that advisors are “relying heavily on active strategies in guiding clients through this period…as they seek to capture outperformance opportunities and mitigate portfolio risk.”2
Outsourcing investment management should be a win/win for both advisor and clients. Outsourcing should provide advisors and their clients with better access to portfolios that best align with their financial goals and risk tolerance, including those that are actively managed. Actively managed portfolios seek to mitigate downside risk that could result in better returns for clients. It alleviates a time burden and the stress of positioning portfolios for the advisor, particularly in volatile markets.
The number of options for outsourcing investment management has grown over the last several years. Congress Wealth Advisor Solutions’ investment platform is one such option and includes a range of actively managed portfolios. Indeed, our Dynamic Prime and Dynamic Quant portfolios are actively managed and have produced better than benchmark returns in the very volatile first quarter of 2022 for our Strategic Partners and their clients.
If you are interested in learning more about why outsourcing might be the best solution for you to allow you to spend more time with clients while also providing an expanded choice of investment options to better meet their financial goals, we are here to help.
1 The Impact of Outsourcing AssetMark 2022
2 Seeking the Active Advantage in Uncertain Times PGIM Investments, 2021
Senior VP, Strategic Partnerships
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