The ON in ON Investment Management Co (ONIMCO) comes from Ohio National Mutual Holdings, Inc. The holding company owns Ohio National Financial Services, Inc., which in turn owns The Ohio National Life Insurance Company, which in turn owns broker-dealer O.N. Equity Sales Company (ONESCO). ONIMCO is a subsidiary of ONESCO.
With nearly $1.5 billion in assets under management (AUM), the firm has headquarters in Cincinnati and branch offices across the office. Surprisingly, it doesn’t have its own website. (Ohio National Financial Services does have a site, though.)
ON Investment Management Background
ONIMCO was founded in 1969. Through the Ohio National group, the investment management firm has affiliations with Suffolk Capital Management; Ohio National Insurance Agency, Inc.; Ohio National Equities, Inc. and Ohio National Investments Inc - as well as ONESCO.
ONIMCO refers to its advisors as investment advisor representatives (IARs). It requires all of them to maintain broker licenses (Series 6 or Series 7) and to be registered as investment advisors with their state securities regulatory agencies (which in turn generally require Series 65, Series 66 or a professional designation). As a result, all advisors are also brokers. Most are also licensed insurance agents. These dual or multiple roles can present potential conflicts of interest that advisors must disclose.
ON Investment Management Client Types and Minimum Account Sizes
Of its individual clients, those who have a high net worth are in the minority at ONIMCO. According to its most recent filings with the Securities and Exchange Commission (SEC), the firm has 195 high-net-worth clients and 8,567 who aren’t as affluent. The firm also works with trusts, estates, charitable organizations, businesses and other organizations.
Each IAR, third-party program and product has their own minimum requirements. Generally, they range from $0 to $2 million.
Services Offered by ON Investment Management
IARs at ONIMCO offer financial planning and investment management services. To receive the latter or implement the former, you can open an account through the Envestnet Portfolio Solutions where your IAR is your asset manager. Alternately, you can opt for a third-party investment program that has an agreement to serve ONIMCO clients on a discretionary basis. They are:
- AssetMark, Inc.
- Brinker Capital
- City National Rochdale
- CLS Investments, LLC
- Envestnet, Inc
- Lockwood Advisors, Inc.
- Morningstar Investment Services, LLC
- SEI Investment Management Corp
- Symmetry Partners, LLC
- Unified Trust Company
Additionally, ONIMCO offers retirement plan advisory services to Employee Retirement Income Security Act (ERISA) plan fiduciaries and plan participants.
ON Investment Management Investing Philosophy
Investing strategies depend on the IAR or third-party program money manager. Generally, they rely on asset allocation, believing that investing in a mix of different sectors is key to long-term, risk-adjusted gains. Some managers may also use tactical strategies that try to take advantage of price anomalies or strong market sectors. Typically, they will invest in domestic and foreign equities and fixed income securities.
Fees Under ON Investment Management
The fee for what the firm calls comprehensive financial planning or modular financial planning is an agreed upon amount that generally does not exceed $5,000. The fee for specialized financial planning is based on an hourly rate that can not exceed $350 per hour or $5,000 per year or is a flat fixed amount that cannot exceed $5,000 per year - unless the home office authorizes the IAR to charge more.
As an investment management client, you’ll be charged fees to compensate the program sponsor, professional money managers (if applicable), the account custodian, ONIMCO and your IAR. The IAR’s fee is between an annual 0.30% to 1.50% of AUM and may be negotiable. There may be other fees, including those charged by mutual funds and exchange-traded funds (ETFs).
What to Watch Out For
As part of a large corporation, ONIMCO may be affiliated with the companies selling the financial and insurance products that IARs recommend. These connections present potential conflicts of interest, just as an IAR having dual or multiple roles does. When receiving recommendations from your IAR, be sure to ask what they are based on and whether and how the advisor and firm may benefit from your following them. As a fiduciary, your advisor is obligated to tell you.
In its most recent SEC filings, ONIMCO reported two legal or disciplinary actions that occurred in the last 10 years. One involved an individual advisory affiliate and one involved affiliate firm ONESCO. The latter was brought by the Virginia State Corporation Commission, which alleged that ONESCO failed to supervise an IAR (specifically his communicating with clients through his personal email account) who misappropriated more than $500,000 from clients. The IAR no longer works for ONESCO and the company paid restitution to harmed clients.
All information was accurate as of the writing of this article.
Tips for Finding the Right Financial Advisor
- Want an advisor who will always put your interests first? Then what you want is a fiduciary, who is often an advisor with no other roles (like insurance agent or broker). Also, people who are certified financial planners (CFPs) are held to a fiduciary standard. To find one near you, use SmartAsset’s free matching tool. After answering questions about your preferences, you’ll be matched with up to three advisors vetted by us.
- Ask prospective advisors how many times in a year they will go over your finances with you. The correct answer depends on your needs and expectations. But once or twice a year should be the minimum. Be sure you know which questions to ask your financial advisor.