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Library guide · Governance

What Is an OCIO (Outsourced Chief Investment Officer)?

The model where a family hands day-to-day management of its portfolio to an external investment office.

Last updated 9 August 2026 · 2 min read

An OCIO, or outsourced chief investment officer, is an external firm that takes over the day-to-day management of an investor's portfolio, making and implementing investment decisions within an agreed policy, rather than the family building a full in-house investment team. It offers institutional-grade investing without the cost and complexity of hiring one.

Not every wealthy family wants to build a full investment team, and not every family should. The OCIO model exists for exactly that decision: how to invest like an institution without becoming one.

What it is

An OCIO, an outsourced chief investment officer, is an external firm that takes over the day-to-day management of a portfolio on a discretionary basis. Within an agreed investment policy statement, the OCIO does what an in-house chief investment officer would do: set the strategy, decide the asset allocation, select and monitor managers, handle rebalancing, and report. The family sets the objectives and constraints; the OCIO runs the money.

Why families use it

The appeal is institutional capability without institutional overhead:

  • Access: OCIOs invest across many clients, giving each one access to top-tier funds, co-investments and manager relationships a single family might struggle to reach.
  • Speed and infrastructure: a full investment operation, research, risk systems, reporting, from day one.
  • Cost: for families below the scale where a full in-house team is justified, an OCIO is often cheaper than building one. See How Much Does It Cost to Run a Family Office?

The trade-offs

Outsourcing the investment function is not free of tension:

  • Control: you delegate the actual decisions, keeping oversight rather than day-to-day command.
  • Fees: the OCIO charges a fee, often a percentage of assets, on top of the underlying managers' fees, so the total cost must be understood.
  • Alignment: the family must scrutinise how the OCIO is paid, whether it favours its own products, and how independent its manager selection really is.

Where it fits

The OCIO sits on a spectrum between doing nothing and building everything. Many families use a hybrid: an OCIO for parts of the portfolio and direct or in-house management for others, or an OCIO early on that is replaced by an in-house team as the family scales. It is one answer to the central staffing question every family office faces. See How to Hire a Family Office CIO

Frequently asked questions

What is an OCIO?
An OCIO (outsourced chief investment officer) is a firm hired to manage an investor's portfolio on a discretionary basis: it sets and implements the investment strategy, selects managers, allocates assets and monitors the portfolio within an agreed policy. It gives a family or institution a full investment office without building one internally.
Why would a family office use an OCIO instead of an in-house team?
For access, speed and cost. Building an in-house investment team of the quality large institutions have is expensive and hard to staff. An OCIO delivers institutional-grade investing, manager access and infrastructure immediately, for a fee, which often makes sense for families below the scale where a full in-house team is justified.
What is the downside of an OCIO?
You give up direct control of decisions, you pay a fee (often a percentage of assets) on top of underlying manager fees, and you must trust and monitor the OCIO's incentives and performance. Alignment matters: the family should understand how the OCIO is paid, how it selects managers, and whether it is truly independent.

This guide is educational and general in nature. It does not constitute investment, legal, tax or financial advice.