Friday, 23 October 2015

Demystifying Investment Management, Portfolio Management

Investors all over the world have long known that all their eggs should never be put in one basket. To further underline the case for diversification, an article in Forbes, published in February 2015, showed how big and small investors alike who failed to appropriately diversify, found themselves caught up in the “financial hurricane” of 2008-2009. In fact Fidelity Investments explains that the main objective of diversification is not to ensure better performance for your investments but to improve returns for your specific level of risk tolerance. This is where investment management services and professional services for portfolio management and share trading in India come to the rescue. However, many of us are filled with doubts and uncertainties when we think of enlisting professional services. To help you make an informed decision, here are the answers to the most commonly asked questions in this arena.

portfolio management

Top 3 Investment Management FAQs Answered

1.    Why do I need an investment manager?

To ensure financial security for yourself and your loved ones and to plan effectively for life post retirement, you need to invest today in the right vehicles. However, how do you know what options are best suited to your risk appetite and your financial goals? This is where an investment manager comes to the rescue. An experienced investment management professional will be well versed in the best strategies for investment, while keeping himself/herself updated on the market situation at all times. They have the still to analyses your current finances and then help you choose the best assets or options for share trading in India, in accordance to your life goals. They also maintain utmost discretion while handling your finances and monitor progress to ensure that you get the maximum benefits.

share trading in India

2.    Why would I need professional investment management?

With the unprecedented amount of information and financial calculators available online, one might wonder why professional investment services are still needed. The reality is that research demonstrates that the track record of individual investors is far from encouraging. Professional investment managers have both the skill and the experience that a layperson might lack. They will be able to see loopholes, assess your risk tolerance and suggest the best options for you depending on your life goals. In addition, they will take care of all the legalities, while ensuring that your tax exposure is minimized. Also, investment management services are well worth the fees, given that they will continuously monitor and modify your portfolio to bring you the best results, while all you need to do is lay back and enjoy the benefits.

3.    Are my assets safe from theft, unauthorized withdrawal and custodial bankruptcy?

Although your portfolio manager would have the discretionary authority to invest assets on your behalf, they do not have the actual physical custody of the assets. All your investment holdings will be kept sage with the bank or financial institution. This adds a layer of security since the custodial responsibility is segregated from the management of the portfolio. You retain the right to grant power of attorney to those you whom you want to give access to your assets. In addition, the best financial institutions will also have their own risk management system and internal control that ensure that there is no unauthorized access to your assets.

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