What is an asset and what does an asset manager do?

Assets are any resource with financial value that an individual or organisation owns that may provide a future financial benefit.

There are 5 main asset classes:

  • equities
  • bonds
  • cash
  • property
  • commodities.

Asset management companies are financial service providers that manage the assets of their clients. This includes providing professional advice and managing a client’s investment portfolio based on the client’s investment objectives and appetite for risk. Each class of asset has a different risk profile and a diversified investment portfolio may include assets from one or more of these asset classes. Asset managers use insights provided by financial analysts and economists, as well as conducting their own rigorous research and analysis of markets and trends, in order to decide what investments to make for their client.

Asset management is synonymous with wealth management - as there are investment minimums. Asset managers are generally hired by wealthy private and institutional investors (e.g. high net worth individuals, corporations and financial organisations).

Key responsibilities

  • Developing and maintaining multiple client portfolios; managing client assets in line with investment objectives and preferences
  • Liaising with clients on asset status, requirements, risks and progress
  • Preparing and presenting periodic asset management reports, financial statements and forecasts
  • Developing complex financial modelling and analysis
  • Undertaking periodic review and analysis of assets
  • Researching market trends; identifying changes that may impact managed assets or investment opportunities to maximise profits
  • Communicating with clients about potential changes that may impact investment portfolios or other forms of assets such as taxation implications
  • Organising and conducting meetings with clients to review accounts
  • Managing any required changes to client portfolios
  • Analysing financials for legal compliance
  • Ensuring asset management systems are current and accurate

Why are they important?

Asset managers pool and manage risk to generate relevant and reasonable returns for their customers according to their requirements. Additionally, asset managers serve an important role in moving money from where it is to where it is needed and can be most productively put to work in supporting investment, growth and jobs for the wider benefit of society.

Skills needed for this role

Asset managers must have excellent interpersonal and communication skills as well as being confident and assertive in their decision-making. They should also demonstrate initiative and the ability to solve problems effectively, as well as having strong attention to detail. Excellent analytical skills and time-management, with the ability to work under pressure are also required in this role.

Strategic Professional Options examinations linked to this role

Advanced Financial Management

Career opportunities presented by this role

Asset managers are most commonly employed in banks and specialist asset management firms. Successful asset managers may progress to managing larger portfolios or take on a senior manager position. Some can then move on to leadership positions within their organisations or set up on their own as consultants.

Competencies

High level competencies required include:

  • Advisory and consultancy

    A. Gathers and understands financial and non-financial information to develop complete knowledge of the client business and the environment in which it operates.

    B. Provides expert advice that will add value to the business and gain advantage.

    C. Identify and advise on business partnering to develop strategic relationships to create opportunities, improve performance and solve business problems.

    D. Prepare and present business plans and advise on the actions to implement these plans.
     

  • Financial management

    A. Links developments in global trade, markets, business practices and the economic environment to required improvements in the financial and risk management of an organisation.

    B. Advises on business asset valuations, capital projects and investments using appropriate analytical qualitative and quantitative techniques.

    C. Identifies, evaluates and advises on alternative sources of business finance and different ways of raising finance.

    D. Communicates and advises on the impact on financial decision making on current developments in regulation, governance and ethics.

    E. Assesses and advises on appropriate strategies to manage business and organisational performance regarding business and finance risk and effectively communicates the impact.

     

  • Stakeholder relationship management

    A. Positively develops relationships with internal and external stakeholders.

    B. Communicates and gains commitment from internal and external stakeholder.

    C. Uses emerging technologies to collaborate and communicate effectively with stakeholders.

    D. Applies professional and ethical judgement when engaging with stakeholders.

    E. Aligns organisational strategic objectives with stakeholder needs and manages expectations.

  • Taxation

    A. Communicates knowledge of the operation and scope of the tax system, obligations of taxpayers, and the implications of non-compliance and advises on tax planning.

    B. Advises ethically on strategic tax plans and computes the tax liabilities of individuals.

    C. Advises ethically on strategic tax plans and computes the corporation tax liabilities of individual companies and groups of companies.

    D. Explains and computes the effects of value added tax (VAT) / goods and services tax (GST) and indirect tax on incorporated and unincorporated businesses and advises appropriately.