An In-Depth Study of Investment Management

Filed Under Investment Management.

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Investment management stands to be formal process of securities like bonds and equities and fixed assets such as real estate and other instruments of debt such. The services offered under investment management are basically required by the investors, which may be individuals, bank, companies, insurance firms, etc with the objective of fulfilling the concerned financial requirements.


Description of the People Performing Investment Management

Almost each person tries to perform the activity of investment management to some extent which comprises investing, budgeting, spending and saving. On the other hand, an investment manager is an individual who focuses on investing money in versatile instruments for accomplishing predefined goals. Investment managers are nowadays better known as fund or finance managers.

Investment or fund or finance managers may focus in discretionary or advisory management as well. When an investment manager simply provides advices concerning where the money needs to be invested and at what time the securities need to be sold, the process is called advisory fund management or advisory investment management.

On the other hand, when an investment manager has the liberty to exercise his discretion in the process of the management of portfolio, without having the need to get the approval from the client, the process is known as discretionary investment management. Investment management is more often than not synonymously used with fund or finance investment. Asset management is time and again used for the effective management of combined investments which refer to the process of the investment of money at the end of ballooned number of clients in a diverse range of investment alternatives. A convincing instance of this process stands to be mutual funds. That kind of investment management which encompasses the management of investments of high net asset value is more or less termed wealth management. Wealth and asset management are collectively known as portfolio management as well.

Establishing the Investment Goals

Investment objectives stand to be different for companies, individuals, banks, financial institutions, mutual funds, pension plans and insurance companies. For example, the goal of a bank may to accomplish a least amount interest spread, while for a private investor the goal could be to maximize the return on investment.

Devising the Plan of Investment

After setting the goal, the plan of investment if devised, based on the constraints that are related to the investor like risk profile, financial capability. Besides this, the investment plan is devised on the environmental constraints like market conditions, state of the economy, government regulations, state taxes, etc.

Setting the Portfolio Strategy

Depending on the constraints and objectives, the perfect blend of asset is recognized. Such asset categories consist of fixed income securities, foreign securities, equities, currencies, debt and real estate of different countries.

Deciding on the Assets

This process encompasses the selection of individual alternatives falling within the limit of different classes of assets.

Evaluation and Gauging of Performance

Investment management stands to be a consistent process. It is therefore important to measure the performance of the wealth and assets and develop it on a consistent basis.

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