By admin on July 16, 2015
Unfortunately, the success of an investment portfolio is too often measured against the capital markets or an arbitrary benchmark. This is not how you should measure the success of your outsourced CIO! It is also not how they should be measuring their own success on your behalf.
Instead, you should measure the success of your outsourced CIO by whether your portfolio is meeting your funding obligations over time, while simultaneously respecting your tolerances for risk/portfolio volatility.
We call this “goals-based investing”. Remember, your investment portfolio is a simply a utility that exists to fund your goals and ensure funds are available for your future commitments and liabilities. This cannot be measured with relative benchmarks.