What do fund management companies do?

 

When it comes to finance companies in India, there are a lot of terms that we connect to them. Debt, equity, wealth, asset, shares, stocks, investment, hedge funds and so on. But what exactly do these finance companies in India do? Well, different firms deal in different services. While some finance companies provide just asset and fund management services, while others provide investment banking or some are those that provide all of the three. The fund management firm that a customer chooses has the power of really changing your financial portfolio totally. Which means that they can either make it or break it.

Therefore, taking sound decisions regarding what kind of wealth management or asset management firm to choose, is very important. The asset manager that is assigned to you by the finance company then studies your entire current financial portfolio in detail. They calculate your current asset and liabilities, what type of risk your current income can take, and with that, he or she also determined how much you need to invest before you retire. They also take care of the kind of insurance you should be taking. In short, they help you plan your retirement in a way.

But how these asset and fund management firms earn? Well, for every profit that you make, they have a fixed percentage of commission on it. This way, they will also be more motivated to carry out your investment journey smoothly. A good fund manager needs to have a sharp eye for at the on going market trends. He or she needs to be able to predict what the future of their client’s current investment can be. In case they sense some kind of loss in the funds, then they need to immediately take out the funds on behalf of their customers. Vice versa, if they accurately predict that a particular fund might do well, they can direct their customer’s money there.