Woman doing fund management work at a computer with a client - Kaplan Schweser

Posted by: Kaplan Schweser
Published: July 5, 2017

If you are thinking about obtaining the CFA® charter, you may end up on the path of becoming a fund manager. Fund management is a career where an individual provides advice and services to private or corporate clients about buying and selling investment shares or bonds to help clients maximize their return on investments. Read on to learn more about what a fund manager does, as well as the path to get into the fund management profession.

The Day-to-Day Life of a Fund Manager

As mentioned, a fund manager is someone who makes recommendations and then trades and invests assets on behalf of clients. Unlike many other finance jobs, fund managers are not simply selling products. They are working very closely with their clients to develop an investment strategy and manage portfolio trading activities based on the client’s goals and level of comfort with risk.

Fund managers ensure that assets are managed in the most cost-efficient and profitable way possible. This includes making decisions to buy, sell, or hold assets. A fund manager pays close attention to cost and risk associated with capitalizing on cash flow opportunities to ensure proper liquidity of funds.

A large component of a fund management position is research. Fund managers regularly research companies, gather information, read financial briefings, read extensively about current events and global economies, and meet with investment analysts and company managers to better understand pertinent financial information. They also likely have a team of financial analysts who use the latest software to do more in-depth analysis on firms, markets, and economic variables. This helps them make recommendations and predictions about future prices and trends.

The Career Path to Fund Management

Fund manager is typically not an entry-level position. For individuals who are just getting started in finance, they will likely begin as an analyst. This role entails spending a lot of time analyzing financial results of companies and learning more about how companies operate. Analysts will likely consume a lot of news and information on companies and sectors relevant to their employers. The fund management (or portfolio management) team will use the information provided by the analyst to inform their investment decisions.

Many people start their road to becoming a fund manager by pursuing the Chartered Financial Analyst® (CFA®) designation. CFA candidates spend an average of 300 hours per exam level (there are three levels) to achieve the CFA charter. The exams cover many important topics to fund management in great depth, including ethics, quantitative methods, financial reporting and analysis, portfolio management, equity investments, and more.

Analysts looking to move into fund management should assist portfolio managers with their work doing research on potential investments and putting together buy, sell, and hold recommendations. This experience can help analysts work their way to the next level. After a number of years of experience working for a fund, understanding fund operations, and obtaining the CFA charter, an analyst will be able to build a solid case for promotion to fund manager when the opportunity presents itself.

Fund management is a prestigious and financially rewarding career. If you are interested in this career path, you may find that obtaining the CFA charter is a great place to start as you build your analyst experience. Learn more from Kaplan Schweser about CFA exam prep, the CFA exam process, and how the CFA charter can help you succeed.