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Investment management

1. Industry Overview and Challenges: – Investment management encompasses fund management, research, marketing, internal auditing, and more. – Financial fund managers require a diverse team […]

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1. Industry Overview and Challenges:
– Investment management encompasses fund management, research, marketing, internal auditing, and more.
– Financial fund managers require a diverse team for successful operations.
– Market valuations directly impact revenue and costs in the industry.
– Sustaining fund performance, especially during market downturns, is challenging.
– Successful fund managers are in high demand and may be recruited by competitors.
– Revenue fluctuations in volatile markets and the difficulty of consistently outperforming are key challenges.
– Clients prefer firm-wide success over individual fund manager skills.

2. Shareholder Representation and Investment Strategies:
– Institutional investors play a significant role in representing shareholdings.
– Shareholders can influence companies through voting rights.
– Investment managers specialize in private equity, real assets, alternative assets, and bonds.
– Wealth management advisors take a holistic approach to client portfolios.
– The top five asset managers hold a substantial portion of externally held assets.
– Different investment strategies and the importance of asset allocation are crucial for fund performance.

3. Global Fund Management Industry Size and Performance Metrics:
– The global fund management industry had around $117 trillion in total assets.
– Conventional assets under management reached $79.3 trillion in 2010, with significant portions in pension and mutual funds.
– The 3-Ps (Philosophy, Process, and People) are essential for producing above-average results.
– Ethical principles guide investment decisions in various ways.
– Risk-adjusted performance measurement tools like the Sharpe ratio are key in evaluating fund performance.

4. Education and Certification in Investment Management:
– Investment management certifications include CAIA, CFA, CIM, and CWM.
– Investment-related degrees and further education beyond a bachelor’s degree are increasingly required.
– Designations like CFA and CIM are crucial for career advancement in the industry.
– Graduates with MBA or specialized Masters degrees are beneficial in the field.

5. Money Management, Wealth Management, and Investment Strategies:
– Money management involves expense tracking, investing, and budgeting.
– Wealth management includes financial planning and managing client assets.
– Investment strategies emphasize diversification, asset allocation, and long-term returns.
– Techniques like risk assessment, tax-efficient investments, and monitoring investments are essential for success.
– Strategies like frugality, avoiding unnecessary expenses, and maximizing wins while minimizing losses are key in investment management.

Investment management (Wikipedia)

Investment management (sometimes referred to more generally as asset management) is the professional asset management of various securities, including shareholdings, bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be institutions, such as insurance companies, pension funds, corporations, charities, educational establishments, or private investors, either directly via investment contracts/mandates or via collective investment schemes like mutual funds, exchange-traded funds, or Real estate investment trusts.

The term investment management is often used to refer to the management of investment funds, most often specializing in private and public equity, real assets, alternative assets, and/or bonds. The more generic term asset management may refer to management of assets not necessarily primarily held for investment purposes.

Most investment management clients can be classified as either institutional or retail/advisory, depending on if the client is an institution or private individual/family trust. Investment managers who specialize in advisory or discretionary management on behalf of (normally wealthy) private investors may often refer to their services as money management or portfolio management within the context of "private banking". Wealth management by financial advisors takes a more holistic view of a client, with allocations to particular asset management strategies.

The term fund manager, or investment adviser in the United States, refers to both a firm that provides investment management services and to the individual who directs fund management decisions.

The five largest asset managers are holding 22.7 percent of the externally held assets. Nevertheless, the market concentration, measured via the Herfindahl-Hirschmann Index, could be estimated at 173.4 in 2018, showing that the industry is not very concentrated.

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