Magistral Consulting

  Examining the Trend of Operations’ Outsourcing by Family Offices Introduction Family offices are the biggest chunk of Limited Partners. They are the chief source of financing for multiple Private Equity, Venture Capital, and Real Estate funds apart from other Limited Partners like Insurance Companies, Sovereign Funds, Pension Funds, etc. The trend of Family Office outsourcing their operations’ activities is fast catching up.   Family Offices are now opening to the concept of direct investing and its time for them to be open about the concept of outsourcing too like their General Partners investees Family Offices and Direct Investments Private Equity as a new asset class was coming up well and operated under the rules of incentives like 2/20. Simply put it means there would be 2% of management fees of the AUM and 20% would be charged from the profits. Under these arrangements, there was a limited risk for General Partners for the lower than expected returns but had a signific...

  Hedge Fund Operations Outsourcing: How does it work? Introduction to Hedge Fund Outsourcing Operations Outsourcing for  Hedge Funds  is slowly becoming a viable proposition to improve analytical excellence and reduce the operations’ cost. Almost all types of hedge funds can benefit from outsourcing and research support services. It aids the smooth functioning of Hedge Fund operations. Hedge Fund outsourcing not only helps in reducing operations cost, but it is also immensely helpful in raising the analytical standards of the fund.   Hedge Funds are investment vehicles that invest in stocks to give superlative returns to their investors. They follow multiple strategies like long-short equity, market neutral, merger arbitrage, convertible arbitrage, event-driven, credit, fixed income arbitrage, global macro, Short only, and Quantitative. Here is what these strategies are and what could be outsourced by each strategy Long-Short Equity Hedge Fund This is by far the mos...

  Outsourced Chief Investment Officer (OCIO) – Details, Activities and Benefits What are Outsourced Investment Officer (OCIO) Services? An Outsourced Investment Officer services or OCIO provide support in terms of research and analytics for investment decisions by a company, Private Equity or Venture Capital Fund, Hedge Fund, Family Office, or an Investment Bank. Simply put, An Outsourced Chief Investment Officer fills in for a regular Chief Investment Officer as and when required. Mostly it comprises activities that support a CIO in performing his services effectively. When is OCIO needed? Outsourced Chief Investment Officer services are designed for funds like Private Equity, Venture Capital, and Hedge Funds, and for Family Offices, Investment Banks, and M&A functions of Corporates When it makes sense to outsource Chief Investment Officer?   It’s not possible to hire a full-time CIO in all situations. In many business scenarios, there is a requirement of a team that supp...

  Deal Origination and Deal Execution Support Services- An Introduction Introduction to Deal Origination Services Making a deal is imperative for a Venture Capital or a Private Equity firm. That is the business they are in. However, behind every successful deal that attracts investment, there is a pipeline of multiple other deals that are curated over time. Deal origination services deal in populating and updating that deal pipeline. Every fund has an investment philosophy or mandate to make deals that are relevant for its purpose of delivering outsized returns. Some specialize in early-stage investments like Seed or Series A while others prime for late-stage investments like M&A or Series D and beyond. Whatever is the fund mandate, it’s imperative for every private equity or venture capital fund to populate the deal pipeline, so that the deals that fit every criterion could be fructified as and when required. For Hedge funds and Fund of Funds, deal origination concerns about s...

  Financial Portfolio Management Services for Institutional Investors Introduction- What is Portfolio Management? Portfolio Management Services are the services that keep a portfolio of investments healthy and prime them to produce expected returns on investments. Sometimes portfolio management is passive, where it mostly deals with analyzing the assets and its performance. In some cases, portfolio management is quite active, where the manager is expected to get into the operations of the invested company and make sure its operational aspects are fine-tuned so that the asset enhances its intrinsic value Whatever is the underlying nature of the portfolio, portfolio management concerns about managing the asset properly and prepare it to give superlative returns for the investors What constitutes a Portfolio? A portfolio has a different meaning for different institutional investors. A Venture Capital or a Private Equity firm may mean invested companies as its portfolio. These companie...