Asset Management -222 - Master's Year 2

Management

Managing invested funds within regulatory and contractual constraints, applying investment policies that have been defined internally. The role of Manager is found within various specialized areas:

• Equity Management
  With a primary focus on publicly traded equities, the Manager gains an understanding of the risk/return profile of their portfolio, as well as risk differentials (tracking errors) and profitability vs a benchmark.
• Bonds Market Management
  With a primary focus on bond and money market products, the Manager gains an understanding of the maturity of their investments (over time), how interest rates evolve (spread variance), and the ratings for their corporate bonds.
• Multi-asset Management
  The Manager gains an understanding of how to find an optimal balance in terms of a diversified portfolio, allocating their funds across different asset categories, business sectors and geographical areas.
• Hedge Funds
  Although this term covers a range of different real-world applications, there are two main forms of hedge fund management: Private Equity and Quantitative Hedge Funds. With a primary focus on unlisted shares, a Private Equity Manager studies the financial viability of the companies they are investing in, as well as a company’s capital inflow and outflow arrangements. Quantitative Hedge Funds are based on arbitrage trading, leverage, short-selling and derivative instruments, for example, with the aim of obtaining results that are uncorrelated to the broader markets.
• Alternative Asset Management
  The term "alternative asset management" encompasses a variety of strategies, with the two main ones being Private Equity and quantitative management (hedge funds).
  Private Equity: Primarily focused on unlisted equities, private equity managers assess the economic viability of the companies they invest in, paying close attention to the conditions of capital entry and exit.
  Quantitative Management: These strategies rely on arbitrage operations, leverage, short selling, and the use of derivatives, aiming to achieve performance uncorrelated with market fluctuations.
  In addition, portfolios have increasingly included unlisted assets or funds specializing in these assets (infrastructure, real estate, private equity, LBOs, private debt) over the past several years. This diversification contributes to a "retailization" movement for such assets, making investment in unlisted assets more accessible to individual investors.
• Wealth Management
  Wealth management is offered through discretionary portfolio management and advisory services, providing personalized support tailored to the specific needs of each client in terms of investment and wealth preservation.

Analyzing Performance

Providing Managers with portfolio performance calculations and analysis, reviewing against benchmarks and looking at risk indicators (Volatility, Beta, Tracking Error, Value at Risk, Stress Test, etc.).

Primary activities:

• Gathering and processing financial information relating to the life cycle of a portfolio.
• Building and utilizing tools to analyze performance and risk indicators.
• Building tools and conducting analysis in order to attribute performance to the different elements within the investment process.
• Validating models and results with Managers.
• Making data and information available to Client Services, as well as monitoring and reporting tools, to enable them to draw up reports for their clients.

Financial Analysis

Evaluating companies within a given business sector, with the aim of making recommendations for buying or selling relating to those companies.

Primary activities:

• Conducting research and analyzing the accounts of companies within a specified business sector.
• Engaging with the relevant contact people within the companies being evaluated, and attending presentations.
• Interpreting results produced by valuation models.
• Making buy and sell recommendations.
• Preparing research reports and briefings for Managers.

Asset Allocation Strategy

Determining how to allocate assets by geographical area and sector within the different fund categories, based on the benchmark, the economic environment, and recommendations from analysts.

Primary activities:

• Obtaining economic forecasts from economists and analysts for different regions globally, and obtaining forecasts for different business sectors.
• Working with Managers and their teams to determine what profiles should be adopted for new funds being set up.
• Working alongside Managers to determine what changes should be made regarding the allocation of funds, to improve the performance of their funds.
• Drawing up reports for Managers and clients.

Trading and Negociation

Working on financial intermediation alongside Managers, negotiating the best prices with contacts at the different brokers.

Primary activities:

• Collecting market orders for buying and selling from Managers.
• Contacting different brokers and negotiating prices.
• Taking market conditions into account: product liquidity, depth of book, the functioning of the marketplace in which a trade will be executed, use of block trading, etc.
• Monitoring a transaction and its execution, liaising with the broker and middle office.

Financial Engineering

Establishing financial products and funds, as well as implementing modeling and pricing tools.

Primary activities:

• Gathering information to understand managers’ expectations and client requirements.
• Setting up products such as: cushion bonds, leveraged funds and structured products.
• Determining the level of risk associated with these products. Putting modeling, back-testing and pricing tools in place.

Account Manager

Grow the Company’s working capital, taking both a quantitative and qualitative approach.

Primary activities:

• Analyzing markets, selecting targets and prospecting.
• Proposing solutions tailored to clients’ specific objectives and constraints, drawing up management contracts in collaboration with the relevant departments.
• Responding to calls for tenders.
• Organizing meetings with prospects.
• Contributing to the development of new products.