asset management company
TRANSCRIPT
Functions of Asset Management
Company Financial Intermediation
Management of Investor Accounts
Funding various investments on behalf of Investors
Designing various investments products and retirement plans
Managing Hedge Funds
Operating private equity funds for M&A and Buyouts
What makes it different
They have a larger pool of resources than the individual investor
Pooling assets together and paying out proportional returns allows investors to
avoid minimum investment requirements often required when purchasing
securities on their own, as well as the ability to invest in a larger set of
securities with a smaller investment.
Mutual Funds
A mutual fund is an investment vehicle that is made up of a pool of funds
collected from many investors for the purpose of investing in securities such
as stocks, bonds, money market instruments and similar assets. Mutual funds
are operated by money managers, who invest the fund's capital and attempt
to produce capital gains and income for the fund's investors. A mutual fund's
portfolio is structured and maintained to match the investment
objectives stated in its prospectus.
Hedge Funds
Hedge funds are alternative investments using pooled funds that may use a
number of different strategies in order to earn active return, oralpha, for
their investors. Hedge funds may be aggressively managed or make use
of derivatives and leverage in both domestic and international markets with
the goal of generating high returns (either in an absolute sense or over a
specified market benchmark). Because hedge funds may have
low correlations with a traditional portfolio of stocks and bonds, allocating an
exposure to hedge funds can be a good diversifier.
Pension Plans
A pension plan is a type of retirement plan, usually tax exempt, wherein an
employer makes contributions toward a pool of funds set aside for an
employee's future benefit. The pool of funds is then invested on the
employee's behalf, allowing the employee to receive benefits upon
retirement.