Career Focus: How to Become a Portfolio Manager
With such responsibilities, the qualified person can earn an estimated $450,000 per year as well.
A Portfolio Manager's Main Responsibilities
Portfolio Manager can have several underlying positions and job descriptions. The person will be responsible for several processes that are dependent on the following factors:
- Size of fund
- Investment vehicle type
- Investing Style
Furthermore, in terms of investment vehicle types, portfolio managers can manage the following investment vehicles: mutual funds, retail funds, hedge funds, institutional funds, trust funds, pension funds as well as commodities. Some also manage investment vehicles that are considered fixed-income or managers are quite diverse when it comes to investing style. They can may use hedging techniques, small or large cap specialties, and other techniques.
Here are the steps to succeeding in such a lucrative role:
1. Educational Background
Candidates with a degree in economics, business, math and accounting are often at an advantage. It's important to note as well that a lot of portfolio managers have academic backgrounds in engineering, computer science, biology or physics. Acquiring an MBA can also prove to be a benefit.
2. Find a Related Job
Most portfolio managers are selected from among the top financial analysts. If the person is not a financial analyst yet, it's important that he or she seeks out such a position in a firm. He or she should also consider being an investment adviser to prepare for more challenging roles, develop skills and add to experience.
3. Secure a License
Examinations would usually require employer sponsorship, so it's highly unlikely to get a license before getting hired. Once the interested party has his or her license, he or she should work hard towards earning another set of certifications to give their career a boost.
Requirements to Get Promoted InternallyIn a firm, financial analysts are usually the ones who are often promoted to portfolio managers. This may be because part of their job descriptions work around either asset management solutions or portfolio management.
This is especially true in Asian countries like Hong Kong and Singapore. Firms that provide services such as fund administration follow this kind of setup. They consider the role of analysts to be perfect training grounds for a portfolio manager position. Analysts are trained how to make crucial portfolio decisions like selling or buying securities or determine what underlying economic conditions affect securities.
ConclusionThough the hours are long and the work is doubly hard, the rewards are certainly worth it. Do you believe the role of a portfolio manager fits your career goals? If you're nodding your head, looking forward to a bright future in finance and ready to take on the challenges, then this career is definitely for you.