Why create a Personal CIO service?
When do you ever get to talk to the person actually managing the money? This is a question we actually heard in an investment meeting and believe it is emblematic of the challenges that many investors face.
Despite the enormous array of service providers available to investors, it can be fiendishly difficult to get a straightforward question answered or to get a truly objective assessment of difficult tradeoffs. We believe this is becoming a bigger issue for two reasons.
One important reason is that the landscape for investing is changing for many people. Both individuals and institutions are having more investment responsibility thrust upon them and many are (rightly) scrutinizing costs. While there are plenty of opportunities to reduce layers of fees and to take advantage of low cost, commodity funds, such a course of action also reduces access to investment expertise when it is needed.
Another reason is that existing service providers have been slow to adapt to these changes, partly out of fear of undermining extremely profitable business models built around recurring fees - that no longer serve many investors very well. As a result, more investors are left with a difficult tradeoff between paying too much for a service they don't use very often and not paying for the service but having no formal access to investment expertise at all. It seems like there is an opportunity to do better.
Despite the enormous array of service providers available to investors, it can be fiendishly difficult to get a straightforward question answered or to get a truly objective assessment of difficult tradeoffs. We believe this is becoming a bigger issue for two reasons.
One important reason is that the landscape for investing is changing for many people. Both individuals and institutions are having more investment responsibility thrust upon them and many are (rightly) scrutinizing costs. While there are plenty of opportunities to reduce layers of fees and to take advantage of low cost, commodity funds, such a course of action also reduces access to investment expertise when it is needed.
Another reason is that existing service providers have been slow to adapt to these changes, partly out of fear of undermining extremely profitable business models built around recurring fees - that no longer serve many investors very well. As a result, more investors are left with a difficult tradeoff between paying too much for a service they don't use very often and not paying for the service but having no formal access to investment expertise at all. It seems like there is an opportunity to do better.
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