Strategic Investment Management, LLC is a large financial advisor firm in Arlington, Virginia that focuses on a variety of portfolio management services. Its client base consists primarily of institutional investors, though the firm also has a couple of high-net-worth individual clients.
Strategic is a fee-only advisory firm. This means that its only compensation comes from client-paid fees. This differs from a fee-based firm, which may also receive commissions from third parties (for instance, via securities transactions and insurance sales).
Strategic Investment Management Background
Strategic was founded in 1987 by former investment employees of World Bank. The firm considers itself to be an outsourced chief investment officer (OCIO), helping its clients grow their assets on a personalized basis. Brian Murdock, who has more than 25 years of industry experience, currently serves as the firm's president and CEO. The firm's ownership includes both employees and Northill U.S. Holdings II, Inc., a division of holding company Northill Capital Group.
Among the financial advisors employed at Strategic, there are a number of financial certifications, including chartered financial analyst (CFA) and certified public accoutant (CPA).
Strategic Investment Management Client Types and Minimum Account Sizes
Strategic works primarily with institutional clients, including investment funds, pension and profit-sharing plans, charitable organizations, businesses, municipal government entities and sovereign wealth funds. A small number of high-net-worth individuals have accounts with the firm as well.
This firm usually does not accept accounts smaller than $100 million, but this minimum can be waived at the discretion of the firm.
Services Offered by Strategic Investment Management
Strategic Investment Management offers a number of investment advisory services to its clients. The firm generally provides discretionary services, which include the following:
- Investment policy review
- Asset allocation study
- Asset class structuring
- Manager sourcing
- Oversight of investment decisions
- Comprehensive risk management
- Oversight and selection of alternative strategies
- Implementing strategies
- In-house asset management
- Relationship management
- Comprehensive investment reporting
Strategic Investment Management Investment Philosophy
Strategic's investment process usually follows five steps:
- The firm's advisors work to set up a system of policy objectives that meet clients needs.
- Advisors find the optimal asset allocation strategy for these needs, including security selection and diversification plans.
- The firm works to structure asset classes in a way that can generate positive returns over both the short and long term.
- The firm sources and selects managers to ensure they can carry out the firm's investment plans.
- The firm and its advisors look to mitigate and manage risk so that clients can meet their goals while taking on a minimal amount of risk.
In addition to this five-step process, Strategic compiles data and research from several vendors that provide key financial insights into which securities are and aren't worth investing in.
Fees Under Strategic Investment Management
Strategic Investment Management charges annual fees based on a percentage of clients' AUM. The fee for global investment management services is 0.50% on the first $100 million. After this, fee rates become negotiable. For non-discretionary services, consulting services, general services, investment fund management and all other services, charges are negotiable and may vary from account to account.
Strategic also charges performance-based fees for certain accounts when negotiated with the client. Fees are calulated and charged on a quarterly basis even though they're shown in in annual percentages.
What to Watch Out For
Strategic Investment Management does not have any disclosures of past disciplinary issues on its record.
According to Strategic's Form ADV, the firm's performance-based fee arrangement "could create an incentive to favor higher fee-paying accounts over other accounts in the allocation of investment opportunities." While this represents a potential conflict of interest, the firm is bound by fiduciary duty to act in your best interest at all times.
Opening an Account With Strategic Investment Management
If you're interested in opening an account with Strategic, you can go online to its website and submit a contact form. You can also call its team or visit the firm's office.
All information is accurate as of the writing of this article.
Tips for Financial Planning
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