What is a “Job in Asset Management”?
A role in asset management is one of the most desired careers for finance graduates. There are a couple of reasons for this – excellent salaries, a better work-life balance compared to investment banking, and a dynamic and interesting daily routine. Typically, candidates have a minimum of a bachelor’s degree in a financial discipline and a professional qualification. However, the requirements for getting hired continually evolve. In more recent years, a rigorous understanding of financial markets and statistics, econometrics, and financial modeling, as well as very good communication and presentation abilities have also become required of candidates.
Asset management generally has two professional streams – investments and distribution. On the investment side, there are fund managers and analysts, who are in charge of running investment strategies. Within distribution, there are sales roles that are responsible for promoting the company’s products to third parties such as independent financial advisors, wealth managers, private banks, pension funds, or other institutions. Investment-focused staff usually spend over 90% of their time managing portfolios and doing security research, while those in sales spend the vast majority of their time meeting existing and potential clients.
Key Learning Points
- Asset management roles are highly desirable because of the good financial compensation and work-life balance
- Entry-level roles usually require a minimum of a bachelor’s degree in a finance-related discipline and a professional qualification
- The required skills and knowledge for a role in asset management are continually increasing
- Asset management has two professional streams – investments and distribution
What is Asset Management?
Asset Management is the professional management of types of investments on behalf of clients such as organizations, institutions, and individuals. Asset managers oversee their clients’ funds and make strategic decisions to maximize the value of these investments while mitigating risks.
Typical Structure and Career Paths
Asset management has a flatter hierarchy relative to investment banking. The depth of the resource is usually a result of the size of assets under management – the larger the amount, the more personnel is needed. On the investment side, the money is run by portfolio managers who are supported by analysts who research and provide investment ideas. Within large companies, there could be a number of levels in terms of seniority, starting with junior analysts who after a couple of years (usually 5+) become senior analysts. Assistant or deputy portfolio managers have usually experienced analysts with over 8-10 years of experience and finally on top of the pyramid are the portfolio or fund managers. They are highly experienced and are in charge of the whole process from sourcing ideas to portfolio construction and ongoing management, typically along with people management responsibilities.
Sales also have a typical career path. Candidates usually start in a support role, assisting relationship managers with distributing materials to clients such as presentations, due diligence questionnaires or specifically tailored materials. On the next tier are relationship managers who communicate directly with clients. This role can be very fulfilling for those who like meeting clients and offering them different solutions for their portfolios. It also involves a lot of work with internal stakeholders such as marketing and editing teams. The most senior role is that of the director. Directors oversee the entire sales process and set strategic objectives in order to increase the inflows into the company’s products.
Access the free guide to roles in asset management to explore different roles, their responsibilities, required skills and education, as well as salary ranges.
Education and Qualifications
Asset managers are looking for talented individuals who can demonstrate a high level of numeracy, intellectual curiosity, and strong soft skills. Our online portfolio manager course is desgined for anyone in or looking to break into the asset management industry, with the ultimate goal of becoming a portfolio manager. The course will help you to master the skills needed to build successful investment portfolios and upgrade your resume with a Wall Street-recognized certificate.
A bachelor’s degree is a prerequisite for a career in asset management, many also decide to pursue graduate degrees such as a Master’s in Finance or Master of Business Administration (MBA) in order to advance their careers. Professional qualifications like the Chartered Financial Analyst (CFA) designation, Chartered Alternative Investment Analyst (CAIA) or Chartered Wealth Manager are also highly valued credentials.
Asset management attracts the brightest talent and it should not come as a surprise that getting a role in this field is quite competitive. First of all, candidates need to have a passion for investments and capital markets, backed by strong financial literacy and numerical acumen. A bachelor’s degree in finance or economics is usually a prerequisite, whereas a master’s degree and professional qualifications (such as the CISI or CFA) can be an advantage for more experienced candidates.
Top Three Tips for Candidates
- Show your passion – for those who cannot offer substantial experience, motivation and potential are the big factors. Complete specific courses and keep on top of the events both in the markets and in the industry.
- Network – find and attend industry events, and get in touch with people who currently work in asset management. In most cases, their advice would be valuable. Also, ask for recruiters’ contacts and get in touch with them too. LinkedIn can also be quite useful!
- Build a strong CV and apply to as many relevant positions as possible – even if you don’t get the job you will learn a lot of things that will help you with your future interviews.
Below is a multiple-choice question to test your knowledge, download the accompanying Excel exercise sheet for a full explanation of the correct answer.
Turnover in the asset management industry is much lower than in investment banking, for example, this can be attributed to the balance of personal life and compensation. However, those with experience in asset management roles can move onto private markets or hedge funds. Analysts can also move onto senior financial positions in portfolio companies as a result of their significant industry expertise and strong knowledge of the companies they cover.