How to Become an Asset ManagerCareer News September 24, 2013
Very simply put, an asset manager handles other people’s money. The purpose is to invest it in a manner that will achieve specific financial objectives within the guidelines of the investment pool, usually an asset management, investment bank or brokerage firm.
The firm invests in stocks, bonds, securities, and other assets, to bring their clients greater returns than can be found in a regular checking and savings account.
What is Required to Break Into This Career?
When the company invests, on behalf of clients, they are offered a wide range of traditional and alternative products that may not be available to the average investor. An asset management position at a bank that includes checking, savings, margin loans and credit and debit cards, places the cash into a money market fund as well as into brokerage services. Individuals who use financial bank asset services create an account known as an asset management account or a central asset account.
There are numerous requirements banking institutions and brokerage firms look for in an assets manager. They will want the candidate to hold a CFA (chartered financial analyst) or a Masters in Business Administration.
A CFA is a program that offers professional credentials in venture analysis and establishes management skills and the practical knowledge needed for the current investment industry.
As asset management works on a percentage of returns, there is the potential to make an enormous sum of money, although, with a volatile market, it is also easy to lose money. You will need strong quantitative and analytical skills.
You must be able to read spreadsheets and earnings reports and turn them into financial models and income projections. Core classes should include statistics and accounting.
Education and Experience are Vital
To begin your career, you should work at least two years in another related job capacity, such as sales, marketing operations or in trading at an asset management firm. Working as an analyst or as an intern in equity research at a banking institution will also help you acquire your credentials and experience.
Apart from advanced educations, recruiters look for particular personality traits in an assets manager. More than just an ability to work with numbers, they want innovative thinkers who are able to drive performance by presenting solid investment ideas.
You need to be a strong team player. For each fund, there is not only an asset manager but a team of analysts, researchers in fixed income investments, economists, sales people and marketers whose goal is to persuade people to buy the fund. The passing of the Gramm-Leach Bliley Act in 1997 has allowed financial institutions to offer both banking and security services. This means that modest investors have many great options without going through a bank or a brokerage firm.
They are able to invest in stocks, bonds, real estate trusts, mutual funds and a number of other options. Additionally, corporations, endowments, pensions and foundations still comprise the largest percentage of investors, which means financial institutions and brokerages continue to look for high performance asset managers.
The average salary of an asset manager is from $69,000 to $85,000 a year. Many asset managers work in real estate where the responsibility lies in maximizing the company’s portfolio and in formulating and implementing long-range investment strategies.
They are responsible for all the product types within the fund, including the development, management and monitoring the activities of assigned real estate projects. This is a promising career path for ambitious students to look into.