financialtreat – will explain the Definition of Investment Management Methods, And Types which you will get in the following article. Let’s read this article carefully!
Investment management can be define as a professional management or management that manages various securities (securities), such as stocks and bonds. This professional management also manages other assets such as property.
Achieving profitable investment goals for investors is the goal of investment management. These investors can be institutions (insurance companies, pension funds, etc.) or individual investors, where the vehicles use are usually in the form of investment contracts or what is generally use is in the form of collective investment contracts (Kik) such as mutual funds.
Definition of Investment Management Methods, Structures, Theories, Constraints, Types, Industries
Definition of Investment Management
Investment management is a professional management that holds a variety of securities or securities such as stocks, bonds and also other assets such as property aiming to achieve investment goals that can be profitable for investors.
The investor can be an institution ( insurance company, company, pension fund etc.) or it can also be an individual investor, where the vehicle use is generally in the form of an investment contract or what is usually use is a collective investment contract (Kik) such as editors.
The scope of services in investment management services is what includes asset selection, stock selection, financial analysis, investment monitoring and planning implementation. Outside the financial industry, the terminology “Investment management is more towards other investments.
Not only from investments in finance such as brands, projects, patents and many others, not only from oligation and stocks. Investment management is such a large world industry and plays a very important role in the management of trillions of dollars, euros, pounds and yen.
Investment Approach Methods
There are many different approaches to how investment management can be done in an investment management company, such as growth, neutral market, value fund, index, small capitalization and others. The different methods each have different features, exclusive financial environment, adherents, cii-characteristics of specific risks.
Structure of Portolio
The business focuses on the investment management industry is that managers are taske with investing and releasing customer investments. Investment advisors from certifie investment management firms must manage the investments of the client tailored to the needs and risk profile of each customer, where the financial advisor will recommend the right form of investment for his client.
- Asset allocation
- Long-term investment
- Diversification
Investment Management Managed Funds Worldwide
The assets of the world’s investment management industry increase rapidly and in 2006 reache a record 55 trillion dollars, an increase of 10Prosensions from the previous year and an increase of 55 Percent if calculate since 2002.
All pension fund assets reache $20.6 trillion in 2005 of which 16.6 trillion were investe in insurance and 17.8 trillion in mutual funds. Merrill Lynch to assess the value of each investment reaches 33.3 trillion, of which one-third is place inside other forms of conventional investment management.
In 2005, 48 Percent of all world investment funds from the Unite States and Japan’s next position were 11 Percent and the Unite Kingdom with 7Persen. The Asia Pacific region has seen strong developments in recent years. Countries like China and India offer potential companies and a lot of circulation adds to their focus on the place.
Investment Management Theory
Investment Management is a professional management that manages a variety of securities or securities such as stocks, bonds and other assets such as property with the aim of achieving profitable investment goals for investors.
These investors can be in the form of institutions (Insurance Companies, Pension Funds, Companies, etc.) or can also be individual investors, where the vehicles use are usually in the form of investment contracts or what is generally use is in the form of Collective Investment Contracts (Kik) such as mutual funds.
The scope of investment management services includes conducting financial analysis, asset selection, stock selection, planning implementation and also carrying out monitoring on investments.
Outside the financial industry, Investment Management also refers to other investments not only than investments in finance such as projects, brands, patents and many others not only from stocks and bonds.
Operational obstructions
Some of the obstacles in operating this investment management business include:
- Gross profit earne in relation to market value valuations so that the fall in the market value of assets will have the effect of a drastic decrease in gross profits on costs.
- It is difficult to maintain investment management performance so that it reaches an above-average value and customers usually show patience with the current lack of poor investment performance.
- A successful investment manager salary and very expensive and has many competitors.
- The achievement of average investment performance depends on the uniqueness of the expertise of the investment manager, but customers do not first ignore it and only simply simply see the success of the company due to internal philosophy and discipline.
- Analysts who have the ability to make profits above the average that has establishe a financial atmosphere in order for them to offer the work offere by the company to manage its own portfolio.
Investment Management Industry
Investment management business activities consist of various fields including hiring professional managers of investments, research, functioning for order and trading (Agreements), settlements, marketing, internal audits, and preparing reports for its customers.
The management of the investment management industry involves so many parties that it is shown how the needs of this industrial complex are. Not only employees who take customers to visit the marketing industry, there are also compliance officers (To ensure compliance with all applicable rules by the company), internal auditors (To audit internal platforms and perform internal control uses), finance (To record financial transactions), computer experts and other supporting employees (To record every transaction and financial evaluation of thousands of corporate customers).
Types and Models of Companies On Indirect Investments
An Investment Company is a financial mediator company that sells shares to the general population and invests funds in various securities or other assets. Investment firms also manage or organize portfolios of securities.
Investment companies are engage as a channel that distributes dividends, interest and realize gains. In indirect investment, there are several investment companies, namely:
• Unit Investment Trust
A Unit Investment Trust is a trust that issues a portfolio forme from fixe-income securities (e.g. bonds) and handle by an independent confidant. This portfolio certificate is sold to investors in the amount of the net value of all assets incorporate in the portfolio plus a commission.
Investors can resell these certificates to trusts in the amount of the net value of the certificate (net asset value or Nav). The amount of NAV per-certificate is all the market value of the securities incorporate in the portfolio minus the costs incurre and divide by the number of certificates in circulation.
• Exchange Trade Funds
A simple funding effort can be interprete as a mutual fund trade on the Influence Exchange and offers diversification in sectors, geographical areas or moreover all markets. The carriers of the exchange are:
- Sold like an individual stock which means it can be bought in lots or littles
- The management fee is lower than the lowest cost of the mutual fund
- Investors control capital gains or capital losses.
• Close-End Investment Companies
A close mutual fund company is an investment company that only sells its shares in a fixe amount, which is as much as during the initial offering. Usually, these investment companies do not offer additional shares, except if there is a subsequent public offering.
Shares that have been outstanding from the initial offering are trade on the secondary market at the market price that occurs on the exchange market. The secondary market is a financial market use to trade securities that have been issue in an initial public offering.
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• Open-End Investment Companies
It is known as a mutual fund company. According to the Capital Market Law No.8 of 1995, article 1 paragraph (27) of mutual funds is define as a container use to gather from the investor population to eventually be investe in the protofolio of influence by the investment manager.
This mutual fund company is an investment company that manages a portfolio and sells its portfolio holdings in the capital market. This investment company still continues to sell its portfolio holdings to investors. Also portfolio ownership holders can resell portfolio holdings to the relevant mutual fund company.
Well, those are some reviews related to investment management by investing you will be easier to achieve profits, especially in companies and well-known investors and thank you.