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Debunking Myths About Outsourced Investment Management

By Adhesion Wealth, An AssetMark Company

2800x1000 Adhesion Blog Header Debunking Myths2024

Outsourced Investment management is a strategy for financial advisors who want to enhance their services and guide their clients toward financial prosperity. RIAs are making the switch to outsourcing, but despite the growing popularity, there are still many misconceptions that may deter advisors from considering this route.

Let’s demystify some of those myths.

Myth 1: Outsourced Investment Management Leads to a Loss of Control Over Investment Decisions

One prevalent myth is that engaging with outsourced Investment management means advisors must cede control over their investment strategies. In truth, there are outsourced investment management programs designed to complement the advisor's expertise by supporting flexibility and embracing a collaborative approach where advisors retain input and oversight. This collaboration enables advisors to focus on broader financial planning and client relationships while leveraging specialized investment management skills. According to AssetMark’s Outsourcing Survey* 98% advisors report delivering better investment solutions from outsourcing investment management.

Myth 2: Outsourced Investment Management Is A One-Size-Fits-All Approach

Contrary to the myth that outsourced investment management providers apply a uniform strategy across all portfolios, the essence of it lies in its customization capabilities. Tailored investment solutions are crafted to align with unique client goals, risk tolerances, and financial situations, ensuring a personalized approach to portfolio management. For the independent advisor, this approach serves as a tool for enhancing the client-customer relationship and improving Advisor Alpha–your value. According to AssetMark’s Outsourcing survey*, 83% stated stronger client relationships as a result of outsourcing investment management.

Myth 3: Outsourced Investment Management Comes Is Expensive

The fear of a high price tag often deters advisors from exploring outsourcing. However, the cost structure of outsourced investment management is designed to be transparent and scalable, providing advisors access to high-quality investment management services that can scale with their practice. This accessibility enables advisors to provide value-added services to their clients. 46% of advisors surveyed* stated that outsourcing is allowing them to focus time on other business activities.

Myth 4: Outsourced Investment Management Sneaks In Hidden Fee Structures

Hidden fees that erode investment returns and surprise clients and advisors alike are another deterrent for those looking to adopt outsourced investment management. Reputable outsourced investment management providers prioritize clear communication, detailing their investment strategies, decision-making processes, and fee structures. This openness fosters trust and ensures advisors and their clients are well-informed about how their investments are managed. The best Outsourced Investment Management solutions extend this into the structure of the program itself, allowing advisors to tailor a customized solution across a range of operational functions including reconciliation, corporate actions, performance reporting, and account administration.

Myth 5: Outsourced Investment Management Involves a Complex Transition

The idea that moving to an outsourced investment management platform involves a complex, time-consuming process is another common misconception. In truth, the shift to an outsourced structure is designed to be straightforward, with many providers featuring comprehensive support to ensure a smooth transition. This process typically involves clear steps for data migration, training, and integration with existing systems, aiming to minimize disruption to advisors' operations. The goal is to enhance, not complicate, the advisory practice by streamlining portfolio management and operational efficiencies, thereby allowing advisors to focus more on client engagement and growth strategies.

The Modern Outsourced Investment Management Platform

Elevate your advisory practice with Adhesion Wealth's customizable outsourced investment management platform. Embrace scalable, efficient, and flexible solutions tailored to meet the unique needs of your business. Streamline operations, enhance advisory services, and deliver unparalleled value to your clients. Join the forward-thinking community of financial professionals who have already supplemented their practices with Adhesion Wealth. Discover the path to greater independence and success—take the first step towards amplifying your advisory capabilities today.

*AssetMark Outsourcing Survey

C24-21033 | EXP 3-31-2026

By Adhesion Wealth, An AssetMark Company

For financial professional use only.

Important Information

This is for informational purposes only, is not a solicitation, and should not be considered investment, legal or tax advice. The information has been drawn from sources believed to be reliable, but its accuracy is not guaranteed and is subject to change.

Investing involves risk, including the possible loss of principal. Past performance does not guarantee future results. UMAs are not suitable for all investors and should be evaluated for suitability by financial professionals prior to investing.

For more complete information about the various investment solutions available, including the investment objectives, risks, and fees, please refer to the Disclosure Brochure. Please read it carefully before investing. For a copy, please contact Adhesion Wealth Advisor Solutions (“Adhesion Wealth”).

Adhesion Wealth is an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”). Adhesion Wealth and third-party providers are separate and unaffiliated companies. Each party is responsible for their own content and services.

Adhesion Wealth is an affiliate of AssetMark, Inc., an investment adviser registered with the SEC.

©2024 Adhesion Wealth Advisor Solutions. All rights reserved. © 2024 Adhesion Wealth Advisor Solutions, Inc. All rights reserved.

C24-20942 | 02/2024 | EXP 2-28-2026