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Myth Busters: The Truth About Outsourcing Revealed

Differentiation is a buzzword in the financial services industry; there’s plenty of “why” surrounding it, but “how” is another story. In a market that’s becoming rapidly commoditized, how do advisors stand out?

The answer isn’t simply investment performance. To remain relevant and competitive, advisors need time to strengthen client relationships, stay on top of new technology trends, and manage their firms in efficient, scalable ways.

Ironically, it’s investment management tasks that prevents them from doing this. But some advisors are still reluctant to redistribute those tasks, even if outsourcing could ultimately be the answer to that tough differentiation question.

To help you make the decision about whether or not to take a less hands-on approach to investment management through TAMP, here are five common myths about outsourcing, dispelled.


I’ll lose control over my clients’ fees and portfolio performance.


With proper due diligence and strategist selection — both of which are built into the TAMP service offering — you can confidently say that you’re doing everything in your control to provide the highest quality investment management to your clients at a fair price.


I’ll no longer provide value; if I’m not managing day-to-day portfolio decisions, what am I doing?


In a Global Investor Survey, investors named peace of mind and knowledge of their financial situations as the top two ways they measure advisor value. By outsourcing day-to-day investment management, you can spend more time building relationships and helping your clients understand their holistic financial picture.


Outsourcing is too expensive for me and for my clients.


The trading costs associated with inefficient investment management; namely, going in and out of the market, or adjusting cash levels, can be exorbitantly high. Additionally, the fees incurred by outsourcing to a full-service TAMP typically include operational tasks that are costly to perform in-house, such as reporting, billing, and proposal generation.


My firm is too big/small to outsource.


Like advisory firms, TAMPs have target clients in terms of assets, complexity, and needs. Some TAMPs do have minimums and can be expensive to work with at lower AUMs, but others value larger relationships and will lower their costs accordingly. While not every TAMP will be the right fit for your firm, there is a partner out there for you.


It’s overwhelming to decide on a TAMP; there are too many options.


Knowing your firms’ needs is more than half the battle when selecting a TAMP. You’ll be able to eliminate a number of offerings right away, for example, if they don’t work with your broker-dealer, custodian, or other platforms. To learn more about what factors to consider when choosing a TAMP, check out our blog here.

When one firm left the TAMP space, they discovered that in fact, the benefits of working with a TAMP far outweighed their concerns. Learn why they returned to Orion Portfolio Solutions, and how that partnership has benefited both their business and their clients. Download the case study here.

Ready to see how the right TAMP could help differentiate your business?

Learn the truth about how Orion Portfolio Solutions can transform your TAMP experience.

800.379.2513 |

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This information is prepared for general information only. Information contained herein is derived from sources we believe to be reliable, however, we do not represent that this information is complete or accurate and it should not be relied upon as such. All opinions expressed herein are subject to change without notice.

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