Articles | March 8, 2019

Traditional Investment Consulting: a Primer

The complexities of capital markets make a sound investment strategy a must-have for asset owners.

Traditional investment consulting will help you achieve long term goals and objectives by establishing a clear framework that focuses on your needs. From investment policy development to performance measurement and more, we’ll work with you to put in place an effective plan for your assets.

traditional investment consulting

Why traditional investment consulting remains so popular with investors

When it comes to picking an approach to plan governance, you can choose from two principal options: discretionary (outsourced) and traditional (sometimes referred to as non-discretionary). Discretionary investment management has grown in popularity recently because it empowers investment managers and consultants to make the day-to-day management decisions, freeing sponsors to focus on their core business priorities. 

But many plan sponsors (and their investment teams) find more success with the traditional investment consulting model. By assuming more control over your investment strategy, you can better tailor it to your organization’s strengths and goals. Often the best solutions are those that work specifically for you – not ones that are offered because they work for the seller, which can be a risk with some discretionary investment consultants.

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What you should look for in a traditional investment consultant

Just because you have more direct control over the management of your assets, that doesn’t mean your choice of investment consultant is unimportant. You’ll still rely on the consultant for research and advice, even if you’re still ultimately calling the shots when it comes to each decision. Here are some things you should look for in a traditional investment consulting firm that will support your organization:

  • Transparency: Any firm should feel comfortable laying out in full their processes, what fees they charge,  if they have any conflicts of interest, and anything else you want to know. 
  • Robust Research: When you hire an investment consultant, you should be getting more than  a cookie cutter set of services. The intellectual capital and cutting-edge research provided by the best firms can help support you to navigate in the changing conditions affecting capital markets.
  • Stability: Just as people depend on your investments for their future, you depend on the consultant to be there for you. You want to make sure you go with a firm that can weather rough markets and has a history of service to demonstrate their commitment to your organization’s success.

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Segal Marco Advisors provides consulting advice on asset allocation, investment strategy, manager searches, performance measurement and related issues. The information and opinions herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. Segal Marco Advisors’ R2 Blog and the data and analysis herein is intended for general education only and not as investment advice. It is not intended for use as a basis for investment decisions, nor should it be construed as advice designed to meet the needs of any particular investor. Please contact Segal Marco Advisors or another qualified investment professional for advice regarding the evaluation of any specific information, opinion, advice, or other content. Of course, on all matters involving legal interpretations and regulatory issues, investors should consult legal counsel.

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