(a) What is Money Management?
Money management is perhaps one of the most challenging yet interesting and rewarding areas of finance because it involves dealing with a portfolio of investments on behalf of clients. If you have a passion for business and are equipped with a thorough understanding of the business environment, then money management is the perfect recipe for your success. However, the path is not smooth as you will be dealing with a lot of uncertainties as well as the general economic cycle.
(b) What are the Aspects of Money Management?
i. Portfolio Management - The portfolio manager usually belongs to a hedge fund and is the backbone of all investments made. Your key responsibility is the management of your firm’s investments, which may consist of various securities (shares, bonds, equities etc.) and assets. Hence, you will implement various investment strategies, such as deciding what assets should be purchased and how much should be purchased, based on the investment objectives of your firm. Apart from that, you will also monitor the returns of investments and allocate funds accordingly.
ii. Mutual Fund Analyst - As the job position itself implies, your work will involve a great deal of research and analysis. Basically, before your organization (pension funds, trust funds, mutual funds etc) decides to commit itself to a certain investment, they will review the details of your analysis. They depend upon your output to tackle uncertainties such as the risk factors of each investment and its possible returns. The job of a mutual fund analyst is exciting and challenging because each investment is different and requires a lot of analysis of data gathered.
iii. Portfolio Management Marketing - This job is the equivalent of a salesman trying to market products or services to a client except that you are marketing a portfolio of investments. Your responsibility is to compile and ‘decorate’ the portfolio so that it can be presented to clients in an attractive manner. You must also convince them of the reasons they should agree to your investments. To be successful, you need to have good interpersonal skills as there is a lot of communication with clients.
