Money is intended to keep moving. If you are lucky enough to have savings, rather than leave them sitting in an account where your money will generally lose value over time, it is a good idea to invest at least some of that cash in order to generate a profit.
Of course, some high-interest savings accounts are actually investment accounts by any other name, and your money is re-invested by the banks to give you a small return that should at least keep the value of your money in line with or above inflation. But to stay in control of your investments, and to hopefully generate bigger profits, you should consider hiring an investment manager.
What Is An Investment Manager?
An investment manager makes and looks after investments on your behalf. They will help you to set up a portfolio of assets and securities and will oversee that portfolio on a day-to-day basis acting in line with your instructions, objectives and previously established parameters. They may provide you with financial advice, based on their experience and professional qualifications.
In terms of what they actually do, the role of an investment manager will vary depending on the type of management you require and the nature of your investments. However, their activities may include buying and selling securities on your behalf, monitoring your portfolio and, if necessary, rebalancing it for you, settling transactions, measuring the performance of your assets and making sure you are compliant with government and financial regulations.
Different Types Of Management
An asset manager typically makes collective investments in multiple options on behalf of a large number of different investors, for instance, in a mutual fund. They may also act as an advisory investment manager or investment advisor, who will make recommendations and suggestions regarding your investment.
This is distinct from money management, where you authorize someone to manage your investment portfolio independently, or on a discretionary basis, acting according to their judgment but following your previously set out requirements and risk tolerance, with the overall objective of achieving maximum profit.
A certified financial planner (CFP) will help you to create an all-round financial strategy based on your income, expenses, capital and future needs. They will also take into account your risk tolerance and other considerations, for instance, if you want to focus on green or ethical investing.
A financial advisor may also be a stockbroker, while a portfolio manager directly invests your capital in order to provide maximum returns. You may also see the term ‘wealth management’, which generally refers to investments for high-net-worth individuals. More recently, companies like Selby Lane LLC, founded by entrepreneur and investor David C Burke, provide advice, expertise and capital to investment firms to help them grow and transition.
How They Can Help You
An investment manager will help you set your financial goals and objectives. How much do you want to invest, how much profit do you want to make, and what is the timescale? Are you looking for a retirement plan, a lump sum that you can pass on to your children, a steady income for the next few years, or a larger payout in order to redecorate your apartment? The decision will be yours, but an investment manager can help you to formulate it.
The next stage is coming up with an investment plan or strategy based on your objectives and taking into account your risk tolerance and financial capacity as well as wider economic conditions, market factors and government regulations. This strategy will be constantly reevaluated as conditions and perhaps your requirements change.
How To Choose A Manager
When shopping around for an investment manager, read their brochure or website thoroughly. Does their philosophy and area of expertise fit with your needs and objectives? Check their qualifications and whether there are any official complaints against them. Compare their fee structure to those of their peers. Remember, however, that typically you get what you pay for: managers who charge higher fees typically outperform their lower-priced rivals.
If you’ve just started saving and your investments are straightforward, or mostly in cash, you probably don’t need a portfolio manager but you may benefit from a financial planner. Once you start looking to invest in securities then it is recommended to consult a portfolio manager who can help you set this up. Make sure that you can contact them easily, and that you feel comfortable and confident asking questions and telling them what you require.
Anyone can make investment decisions, but working with a qualified, professional investment specialist will help you to make the right ones. From analyzing your status to helping you choose the best stocks, assets and securities, to creating a strategy and monitoring your investments day to day, they will more than justify their fees.