What Does An Asset Manager Do? A Complete Guide

So, you’re thinking about entering the field of asset management. If yes, you need to know what does an asset manager do.

The asset manager position holds substantial importance in the financial sector. In this role, you’ll handle the investments of high-net-worth individuals and companies. In addition, it’s well-known to be a lucrative industry. 

So, what happens when you get an asset manager job, and what will be your role? 

Well, it’s quite a diverse position. For starters, you’ll be in charge of building a portfolio of investments that generates profit while incurring the least amount of risk.

You should also be well-versed in how various financial markets work, types of assets, and more.

Sounds interesting, right? But there’s a lot more to it! In this guide, we’ll go through the fundamental responsibilities, required skills, and the influence of technology, in this field of work. 

Let’s jump right in, then! 

Types of Asset Managers and Their Roles

What Does An Asset Manager Do

Asset managers are crucial to a company’s ability to meet its financial goals. In addition, they have different responsibilities. Some of the common ones are:

1. Portfolio managers

They oversee their client’s investments. Plus, they have techniques they use to mitigate risks such as ESG, and strategic asset allocation to manage clients’ portfolios.

2. Investment managers

One of their roles is an investment in equities or commodities. That’s their specialization and they also consult with investors on any investment strategy.

3. Real Estate managers

They are in charge of property management. They are responsible for tenant relations and the upkeep of the property. 

4. Institutional managers

They work with large institutions like pension funds. You will find that they often need large capital requirements. One of the reasons being they apply more complex investment techniques than other asset managers.

As we have established, an asset manager has the responsibility to help their investor achieve ROI. One way to achieve it is by making smart investment decisions. You must also do in-depth research and analysis, risk management, and transparent client communication.

Sounds exciting, right? I bet it does. Now let’s look at the skills and academic certifications that you need to get this job.

What Are the Qualifications for Becoming an Asset Manager?

So, there are a few qualifications you need to become an asset manager. It’s a mix of education, skills, and personal traits. Let me break them down for you:

1. Academic qualifications

Educational qualification requirements for asset managers require a graduate degree. Although, the type of manager specialization will depend on the portfolio you will handle. For example, if you’re in charge of intellectual property, understanding IP law would be ideal.

It’s a good thing because the roles are open to all types of professionals.

Another thing is if you have an advanced certification like an MBA, you have a better chance for career advancement. Plus, if you want to rack up academic certifications, there are several professional certifications you can enroll in. A good example is the Chartered Financial Analyst (CFA). It’s one of the gold-standard courses that can cement professionalism in the investment management industry.

2. Relevant skills and experience

Investment management is not for the faint of heart. It requires strong skills in financial analysis and research. Aligning your client’s investment portfolio with their risk tolerance and objectives is essential. So, having expertise in risk management strategies is crucial.

One way to gain experience is by enrolling for attachment in private equity firms. They can lay a foundation and the knowledge needed in the industry as an asset manager.

3. Personal qualities and characteristics

When you start working as an asset manager, you will be interacting with third-party vendors. So, your services need to be cost-efficient. Plus, having a smart mind, excellent personal traits, and attention to detail is crucial. 

Another thing you have to adapt to the market trends and have the desire to learn. These skills come in handy when negotiating contracts and you can use them to persuade third-party vendors when closing a deal.

Asset Managers vs. Financial Advisors

NoAspectAsset ManagerFinancial Advisors
1.Primary RoleTheir role is to manage investment portfoliosTheir role is to offer financial planning advice
2.Types of ClientsThey deal with organizations and high-net-worth individualsThey deal with retail and high-net-worth individuals
3.CompensationFees on AUM Performance-based incentivesCommissionsFees on assets under management
4.Education and CertificationCFA, MBA, Series 7, 63, 65CFP, ChFC, PFS, Series 7, 63, 65.
5.Focus of InvestmentTheir goal is to maximize returns on assetsTheir goal is to meet client goals and objectives
6.Investment ProcessConduct market research Build and manage diversified portfoliosConduct financial planning Assess risk tolerance Recommend appropriate products
7.ResponsibilitiesDevelop and implement investment strategies Monitor performance Risk management and financial reportingProvide investment advice Retirement planning Tax planning Estate planning Insurance
8.Legal ObligationsThey have a fiduciary duty to put the needs of one’s clients firstSuitability standard must recommend products that are suitable for the client’s needs and objectives
9.Professional AssociationsCFANAPFAFPA

Understanding these differences is in your best interest. Here is why, they have an impact on the following areas:

  • The services offered
  • Amount of fees charged
  • Legal obligations owed to clients

I have already mentioned how your education and skills can put you ahead of the curve. Next, I’ll dive into what roles technology has in asset management.

What Is the Role of Technology in Asset Management?

You’re probably aware that tech is rapidly evolving. In asset management, we’re seeing significant advancements in:

  • Automation and data analysis
  • Robo-advisors and online investment platforms
  • Cybersecurity and data privacy concerns

1. Automation and data analysis

Asset management companies now use management tools to streamline workflows and improve decision-making. For example, AI bots now help in big data analytics to assess fund management risks.

When you think about it, it can be tiring analyzing data manually, and chances for error are high. Data analysis tools can provide extensive market data analysis and valuable insights into the performance of investments and portfolios.

2. Robo-advisors and online investment platforms

They come in handy in providing clients with a cost-effective option for traditional management services. They use algorithms to manage portfolios, reducing sole dependence on human advice. It makes asset management accessible to many people, which is great.

3. Cybersecurity and data privacy concerns

Anything that uses technology always raises concerns. One being data privacy and cyber security. So as automation and the use of AI grows in asset management, it’s critical to have robust cybersecurity measures to protect sensitive client information. After all, you want your client’s data safely stored and following applicable data privacy legislation.

What Are the Future Trends in Asset Management?

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The asset management industry is constantly changing. The good news is that we expect some of the trends to revolutionize the field in the future. Some common ones include:

  • Technological innovation
  • Demographic and socioeconomic trends
  • Shifts in investor preferences and priorities

1. Technological innovation

Tech is changing the asset management industry. If you check the number of analysis tools currently available, they’re in the hundreds, meaning they will continue to grow. It’s a good thing since now you can streamline your work and boost efficiency. Leverage tech to raise your game and stay ahead of the competition.

2. Demographic and socioeconomic

They also play a huge role. Retirement planning services will be in high demand as baby boomers retire. Plus, don’t forget the millennials are rising, and they will be an enormous force in the industry with their investing power. They seem to focus on sustainability and socially responsible investing, which is brilliant.

3. Shifts in investor preferences and priorities

Investors are changing their preferences, which means the asset management industry will have an impact. Clients will look into investments that align with their beliefs and values. 

One way to stay ahead of the competition is to incorporate ESG aspects in your strategies. In the last few years, ESG has gained momentum in the industry and it can come in handy if you’re staying ahead of these types of trends. These factors will surely influence the future of asset management.

What Does An Asset Manager Do? – Frequently Asked Questions (FAQs)

1. What ethical considerations do asset managers need to consider when managing assets?

Becoming an asset manager comes with responsibilities. One is managing an investor’s money. However, there is some ethos you must have, such as a fiduciary role. It states you put a client’s interests first.

2. What risks do asset managers face in managing assets?

Managing assets on behalf of clients exposes you to various risks. Market risk, which results from variations in the value of investments, is one of the most prominent risk types.

3. What types of assets do asset managers typically manage?

Asset managers oversee securities like bonds and stocks, real estate, equities and commodities, cash, and other financial items. As an asset manager, your objective is to maximize your client’s return on investment.

4. How do asset managers manage the risk of investing in volatile markets?

Risk management is one part of the puzzle in asset management. However, some standard techniques that help shield investor money include hedging, stop-loss orders, and more.

5. How do asset managers communicate with their clients about investment decisions and performance?

Communication is critical when making investment decisions for your client. Asset managers use standard communication methods like virtual meetings, reports, and more.

6. What strategies do asset managers use to maximize returns on assets?

There are several strategies that an asset manager uses to maximize returns. However, it depends on the goal and risk tolerance of their clients. Some common ones are ESG investment, strategic asset allocation, tactical asset allocation, and more.

7. What activities are in asset management?

Your asset management responsibilities are maximizing returns and minimizing risks for your clients. You need a deeper understanding of financial markets, asset classes, and risk management strategies.

You’re expected to do more than investment management. You need to offer investment advice, financial planning, and related services. Achieving your client’s financial goals is a big responsibility you can’t take lightly. 

Asset management requires technical expertise, analytical skills, and interpersonal abilities for a customized investment strategy.

Wrapping Up

Becoming an asset manager can open doors for you if you want a finance investment career. However, remember it comes with responsibilities, and you must have academic qualifications and practical experience. Plus, it’s not all about certifications. You need to show dedication to succeed.

Overall you need to remember that to become a successful asset manager you have to be a go-getter. The best part? Tech and innovation are helping the industry evolve by streamlining work processes. Ready to start the journey? 


Hi, I’m Avadhut, Founder of FinanceWalk. We help you make a rewarding career in any field based on your Inner GPS 🙂.

Contact us for Career Coaching.

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