Showing posts with label investment manager. Show all posts
Showing posts with label investment manager. Show all posts

Wednesday 16 October 2013

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Importance of Asset Management Companies (AMC’s)

Recently crowned as the world’s third largest economy by the Organisation for Economic Cooperation and Development (OECD) can we say that the Indian economy is already trembling? With the financial crisis in different global markets, the outlook for the Indian economy is grim and bleak. Owing to the constant volatility that is present in the market along with the fluctuating currencies it is extremely important to manage one’s finances with utmost precaution and care. Besides this, the plunge of the Indian Rupee to an all-time low against the USD is another factor why finances need to be handled well.


There are a number of asset management companies/firms (AMC’s) which invest all the pooled funds of different investors in securities as per the investment objectives. These companies mainly engage in the business of investing in as well as managing a portfolio of securities. Assets are of different divisions and they may be bonds, real estate, stocks, shares or even commodities.

There are a number of investment managers who are specialised in discretionary or advisory management on behalf of private investors (normally wealthy). This may also be referred to as portfolio management, money management and is often within the context of private banking.

These managers are responsible for all the activities that are associated with the management of the client’s portfolio. This may include the buying as well as selling of different securities on a day-to-day basis, performance measurement, portfolio monitoring, settlement of transactions, client and regulatory reporting.
These managers consider the various degrees of portfolio diversification and help to create a list of planned holdings. This particular list is extremely beneficial in determining what percentage of the fund should be invested in a particular bond or stock. In order to be effective at this, it is very important to manage the correlation between the liability returns; asset returns cross-correlations between the returns and any internal issues to the portfolio.

There are many different styles/approaches of funds management that can be employed. Some of these approaches include value, growth, market neutral, small capitalisation, etc.  Every approach has its own distinct features as well as risk characteristics.

The growth style of investing is type of investment strategy where growth investors invest only in those companies which exhibit signs of above-average growth.

Investment managers may range in size; they may be one or two people and may even go up to large multi-disciplinary asset management firms having offices in different countries. The fees that are charged are generally determined on a percentage of the client’s assets under management (AUM).

Asset management can be of different types. Some of these include financial asset management, enterprise asset management and public asset management/corporate asset management (CAM). Financial asset management refers to the management of collective investment schemes as well as segregated client accounts. Enterprise management refers to the business processes and enabling information systems which support the management of the assets of an organisation. This may include physical asset management, fixed asset management, IT asset management and digital asset management.

Asset management company (AMC) is that company which specialise in the provision of services whereby one's financial securities are managed well. The investment managers are in charge of buying as well as selling all the securities of a person's financial portfolio.

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