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Investment Management: Graduate Area of Work
Investment, fund, and asset managers build clients’ portfolios through a marriage of strategy, research, and insight.
Investment management, also known as fund or asset management, is about managing clients’ finances in order to achieve specific goals. Those who work in this field monitor the financial markets, and then make the most of their clients’ portfolios by investing in a variety of potential profit-making securities and asset classes.
Investment managers spend a large fraction of their time analysing the prospects of individual companies and industries in order to try and find out which businesses are likely to outperform others. You could end up researching oil rig providers, trends in organic food prices, and acquisitions by large IT companies… all within the same day.
Often, investment management is like a strategy game, where your goal is to outsmart thousands of rivals out in the financial markets in a constant race to find the best investment options.
There are two main roles within investment management: the analyst and the investment manager.
The analyst handles the research – following the markets closely, analysing stocks, and predicting trends; all to produce a strategic game plan. The investment manager then uses this game plan to deal with the client’s portfolio, carrying out transactions according to the analyst’s findings.
Typically, the earning potential of investment managers is proportional to the success of their investment options. A successful investment manager is one who manages to combine initiative, research, and foresight to make the right choices with their clients’ money.
Most graduates enter this industry through a graduate programme, and will typically start off as an analyst. The usual duties that await you as an entry-level analyst include analysing data from the market, preparing reports, contributing to portfolio decisions, as well as presenting your findings to company management.
Depending on company policy, some employers will want you to focus on only one particular sector, country, or product as an introduction to the industry. Others may want to expose you to as many products as possible so as to gauge your competency and compatibility.
Following that, you may choose to advance tothe role of investment manager if you wish. This brings with it an increased amount of client-facing, and you will often have to travel in order to gain a better comprehension of thesectors and products you are investing in.
Being promoted does not mean that you can offload all the research work to someone else, though! Many investment managers will still continue doing hands-on analysis to avoid becoming too distant from company analysis and the latest market/industry trends.
Possessing a finance-related degree is generally advantageous, but not essential. Of more importance are your enthusiasm for and your ability to comprehend the workings of the financial market.
In order to gauge your suitability for this field, it is advisable for you to try out some internships with investment management companies. This is the best way for you to explore the industry, and to check your compatibility with the profession.
Most companies, especially international ones, will encourage you to sit for professional papers such as the Investment Management Certificate (IMC), the Chartered Financial Analyst (CFA), or even the Certified Public Accountant (CPA) paper.
Local companies may also want you to take the Capital Markets and Financial Advisory Services (CMFAS) paper. Depending on the services that are expected of you, you may have to sit for a few different modules.
Apart from these professional papers, however, it is imperative that you cultivate an open mind and a tolerance for uncertainty, as you will have to deal with ambiguity on a daily basis. You will need to have the ability to stay one step ahead of the competition, by getting thoroughly involved in hands-on research and second-guessing changes in the marketplace.
Due to the ambiguous nature of the work, you also need to be able to take a stance, and not be easily swayed by conflicting viewpoints. This may sometimes put you at loggerheads with senior colleagues or clients, but that is where good communication skills, tact, and confidence will aid you in conveying your messages diplomatically.
Ups and downs
Working as an investment manager gives you the opportunity to learn from experienced investors, as well as a chance to to learn the inner workings of various sectors.
Even in financially uncertain times, career prospects for investment managers can still remain largely positive, particularly since concerned investors greatly value the expert advice of investment management firms on how best to look after their money.
You may, however, have to work late hours due to the sheer amount of research necessary in this line of work– particularly at the beginning. Keeping up with the swiftly-changing market may also be a problem, especially when it veers off your projected course of action.
During such instances, it will be up to you as the investment manager to weigh the situation and to come up with a contingency plan.