We hear more and more often about asset management, but apart from a superficial literal translation and some notion recovered here and there from the definitions on the web, few know exactly what it is. For the curious who intend to expand their wealth of knowledge in the financial field and for those who want to approach the subject, for professional or study needs, we have created a short guide in which we will explain the concept of asset management; in the following paragraphs we will analyze the characteristics of the activity and the requirements of an asset manager.
Business Asset Management: What It Is
The term ‘asset management’ is increasingly used, in the financial world and among specialists in particular and in general among all types of savers. Literally the translation is ‘asset management’, but the meaning of asset management is much broader. Using the Hamilton Chukyo Brokerage platform is the best one there.
Whether it is called ‘wealth management’, ‘resource management’ or ‘asset management’ it is an activity aimed at managing wealth on behalf of third parties. The ‘wealth’ in question can identify tangible assets (e.g. real estate), intangible assets (e.g. financial securities), human capital or intellectual property. The market, with regard to this activity, identifies 3 types of demand: retail, institutions and companies. The ‘retail’ sector mainly requires financial asset management services and legal, tax, insurance, social security, etc.
The institutional and corporate sectors mainly require administrative management services and consultancy regarding portfolio and financial management choices.
The heart of the activity consists of two fundamental phases:
Asset allocation: definition of investment strategies aimed at optimizing the expected return and risk; process through which resources are invested in several directions, based on the risk and the customer’s indications.
Management style: definition of the operating procedures aimed at portfolio management; criteria and principles adopted in the asset allocation and stock allocation phases.
Asset manager: who he is and what he does
The profile that deals with asset management takes the name of Asset Manager, a figure that has become fundamental for the business of companies, whether small, medium or large. Not infrequently, company resources are used in an unproductive way, which requires the advice of specialized figures to be responsible for monitoring and managing company funds. Considering the delicacy and complexity of the sector, it is easy to understand that the activity cannot be carried out by anyone but a managerial figure is necessary.
The Asset Manager takes care of managing the company assets, selecting profitable and low risk investments. The management can concern a particular market (funds, shares, bonds, etc.) or it can be directed towards a specific geographical area.
The business can also be carried out for the capital of a private client.
The Asset Manager essentially deals with identifying the allocation policies and the best investment strategies, based on the company objectives and the client’s indications; its operations take the form of dividing the portfolio (resources to invest) in several directions and in different sectors. Its mission is to carry out the most profitable trading operations, minimizing risk and maximizing returns.
