How Do ESG Funds Determine Good Will of a Business?

When you talk about investing your money as an individual, into something big, you usually talk about shares, bonds, property, land or real estate. But when you talk about investment as a company, there are many types of investments that come into the picture. There are the long only funds, long term deposits, investing into a business, mergers, acquisitions, and so on. As your business grows, so does your capability to invest in various types of funds. With bigger businesses,

This is when the ESG funds comes into the picture. ESG funds are the Environmental, Social and Governance funds that a company invests in for the betterment of the internal working of the company. In the environment aspect, it is about whether the company takes care about the environmental factors in their campus while expanding their business. In social aspect, the company is gauged on the basis of their empathy and consideration towards their employees. This could be investing in their better experience at work, giving them good experience and so on. The governance part deals with whether or not the company is following legal practices in carrying out day to day activities.

ESG funds determine the good will of a company. The investors investing in the business judge a company on tis basis as well.

The investment banking companies in India, help the bigger firms in managing these funds as well. It is not always that everyone is aware about investing in these kinds of funds or how to. The investment banking companies do a detailed study about this and help the companies determine the amount to be invested in these funds and what kind of procedures need to be followed. This should not be confused with CSR, as CSR is Corporate Social Responsibility, a program through which the MNCs and other bigger giants give back to the society.

Basic Difference Between Investment Banking, Asset Management and Wealth Management

Investment banking is one of the oldest forms of investment that the world knows of. History knows that there has been nothing more controversial than global investment banking companies, in the past. Although the nature of investment banking is quite volatile and spontaneous, investment banks have managed to stay astride for these many years, into the modern world, bringing in the wisdom from the past. If you consult any investment banker, you will know the swiftness and the agility needed in the profession. Typically, investment banking companies deal with trading of derivatives, foreign exchange, fixed income, commodity, dealing with mergers and acquisitions, underwriting and so on.

This is a lot more different that asset management. Although some top asset management companies in India do function as investment banking companies too. While investment banking is more spontaneous and requires the investment banker to always be on his or her toes with the ongoing trends, asset management is a little more sorted. In asset management, money is invested in bigger amount and in bigger more stable assets, that will fetch us the returns in long term. An asset manager guides their customer into investing smartly. 

When we talk about wealth management firms, we talk about long term. Wealth is a summation of all the assets that a person owns, that are not always monetary. For example, land, property of various kinds, investment in bonds and shares, investment in some other business and so on. One difference between asset management and wealth management is that asset management focuses on expanding the assets and investment of a customer. While wealth management is about managing the assets and financial aspects of a client. Wealth management basically keeps the financial needs of a customer ahead whereas asset management works more on commission basis.

What A Career of Asset Manager Requires from You?

Are you someone who is interested in getting into finance but not in something as heated as investment banking? Does what you want to do have to be something that is client oriented but does not involve too much risk? Well then, you should definitely try going for the role of an asset manager. To get into this field and to eventually work in top asset management companies in India, you first need to have a good finance degree, which will set the base or the foundation for your understanding of the whole financing system. Then, getting into the banking system is important. Understand how the banks function, what kinds of terms and conditions they lay, what kinds of investments could be fruitful to what kind of customers. To become an asset manager, you may also require a degree in Management that certifies your skills as a business manager and makes you fit for the job of a manager. In asset management, you need to carefully study what the existing financial portfolio of the client is, what kind of assets and liabilities to thy already have and amidst all this, what kind of investment would be fit for their current situation. Other than this, it also matters as to what assets you advise them to invest into. If it is something long term, then you might want to advise them in investing in property and real estate. For something more short term or something that can be retrieved at any point in life, investment in bonds and shares is advisable. Once the asset management is taken care of, wealth management comes into the picture. For this, the customer need not go looking for separate wealth management firms. The asset management firms can provide them with a wealth manager who can handle and maintain the wealth created in the asset management.

What Can You Do If Not Investment Banking?

One of the main features of working for investment banking firms in India is that you get to learn and deal with a lot of money. However, this lot of money that is given for investment is in big numbers and done by big businesses. An investment banker always needs to be well equipped with knowledge of his field and should also be on toes with all the latest information and trends that are going on in the market. Investment banking has been around for many years and we have seen in the past the amount of controversies and action that investment banking can bring in to the economy. Which is why, every investment banker who wants to excel in the field, should have the heart to take risks, leaps of faith and face any hurdle that may come your way. When people invest a huge amount of money especially on the advice of the investment banker, they are going to want a good amount of 

returns on that investment. The investment banker also always must be on the look out for any threat on the investments done by his clients and is also liable to take decisions in case of such emergencies.

If you are someone who really wants to get into finance but do not want to be on the side of dealing with stress such as in investment banking, then you can very well join an asset management company that gives you the exposure in terms of clients that you need. In asset management, you get to work on being a part of client’s financial journey. You also help them to expand their financial portfolio and get maximum amount of returns on their investments. Either way, you get to interact with various types of client, and you have to be well versed with knowledge in the related field.

The Qualities of a Good Investment Banker in India

To be working in one of the best investment banking firms in India there are many prerequisites that a potential candidate might have to meet before applying for the position. It is not limited to just having a knack for numbers, but also extends to his or her qualifications. Having a good amount of education and degree in finance is necessary. This could be a degree in banking, finance, accounts, or even economics. With this, if you have a post graduate degree or a master’s degree, you would easily have an edge over all the other candidates in investment banking.

A career in investment banking involves not just financial advisory services but also a long term commitment with high profile clients and a promise to help them expand their financial boundaries, to assist them in achieving their financial goals. For this, you need to possess and hone your communication skills and presentation skills as well. Being an investment banker could be a mentally taxing job sometimes, especially when the markets are as fluctuating as they are today. For this, you will need to have the patience and the courage to at times take risky decisions.

As a dedicated investment banker, you might also have to be available to take calls at odd hours. Sometimes working could go on for longer hours too. Investment banking companies can also perform the role of an asset management company to a business. Although asset management may seem less risky than investment banking, all the above-mentioned skills are important to be someone’s asset manager too. Having a good understanding of the on-going market trends, being informed about market and stock dynamics that change every day, thorough understanding of your client’s financial goals and requirements and being committed to serve the best to your clients make you a good and reliable asset manager. 

Different Criteria That the Investor Investigates Before Investing in A Business

How does having good amount of funds in the bank amount make a business stronger to take any kinds of risks? Well the obvious answer to this is that the funds in the bank act like a cushion, ready to save the company in case they experience a fall in their business. When a business is backed up by a good amount of funds, they ensure that the company can keep running even if their said project was a debacle. It gives them more time to come out of the loss, think what went wrong and maybe come back stronger and with new and fresh ideas for the market.

There are many types of funds and assets that a company invests into. There are some funds, like the long short funds, mutual funds that are necessary for the long running of the company and then there are some other funds such as the CSR or the ESG funds (environmental, corporate, governance) funds that might act as a catalyst in the smooth functioning of the business and also ensures improved credibility of the business.

When a company invests in the ESG funds, it becomes a criteria for the investors to choose the best business from. For example, if there is a hefty investor who believes in the idea of environmental preservation and he finds a business whose ideas are aligned with his, then they are sure to go for that business. There are many investment banking companies or brokerage companies that help to employ the ESG criteria. The same logic applies for investors looking through the social criteria and the governance criteria as well.

When it comes to governance, investors need to know that the said company is following all the ethical accounts practices and the share holders have equal voting rights. With social criteria, it includes whether the investors having relations with appropriate suppliers, whether the give benefits to the employees and so on.

What Is Your Role as An Asset Manager?

What does it take to be working in one of the top asset management companies in India? First and foremost, you need to have a thing with numbers. Having a knack for numbers, calculating faster and making faster decisions is really going to help you in many ways. Next, you are going to need a degree in finance. It could be a Bachelor of Commerce or it could be a course in finance and accounting. But with a professional degree you become ready to step into the professional world of finance. You cannot just directly start of as an asset manager in the entry level. To become a good asset manager, you first need to learn to make quick and good decisions especially those which are in favor of your client. Your clients are generally going to be companies or people who want to increase their scope of investment but do not have a good guidance for the same. For this, the asset manager comes into the picture, who guides and helps them achieve their financial goals in the said time. As an asset manager, you need to be understanding of the requirements and empathetic about what the customer needs and what they could do better. Reassuring your customers that their money is in safe hands is also a part of your job as their asset manager. Plus, you will also need to have sound knowledge about difference aspects of the field such as investment banking, wealth management, credit management, ESG funds, long short funds, hedge funds and so on. Everything you do for the client, counts. As their asset manager, you must be well informed about the company goals, financial status of other companies and always looking for an opportunity for good investment for your clients.