Reviewed by Aug 27, 2020| Updated on
A portfolio manager ideates and implements investment strategies for individuals or institutional investors. Under the scope of careers in the financial services industry, portfolio management is available with pension plans, hedge funds, and private investment firms, or as part of an insurance or mutual fund company investment department.
Portfolio managers are also called investment managers, wealth managers, asset managers, or financial advisors. However, the emphasis of a true portfolio manager role is on the analytical side of investing rather than the sales aspect.
Portfolio managers have a primary responsibility to create and manage private client investment allocations. Some managers of portfolios work with individuals and families, while others focus on institutional or corporate investors.
In most situations, a portfolio manager implements a predetermined investment strategy defined by an Investment Policy Statement (IPS) in order to achieve investment goals for a company. Many portfolio managers create the investment packages offered to customers, while others simply handle customer expectations and transactions.
Portfolio managers buy and sell securities via an investor's account to maintain a specific investment strategy or objective over time.
Education and Training
Typically, portfolio management requires an undergraduate degree in business, economics, or finance. Most financial institutions also require financial services or investment experience, with a focus on providing clients with portfolio recommendations or an in-depth analysis of the financial market.
Individuals best suited to a position as a portfolio manager possess certain skills, including a high degree of data interpretation efficiency and a keen interest in research and analysis. In addition, a thorough understanding of financial markets, economics, and portfolio theory is needed to stay with a long-term career.
Individuals must also be customer-focused, with a desire and ability to communicate frequently with investor clients regarding their accounts and investment performances.