Job Guide - Fund Manager

The Job and What's Involved

Fund managers are professional investors working on behalf of clients - companies, institutions, government departments and individuals. Using money provided by their clients, they try to increase its value by investing in (buying) shares, bonds and other assets.

They may invest for capital growth where they expect the value of the investment to increase over a period of time. Or they may invest for income by buying assets such as shares or property that will earn an income, usually dividends, interest or rent. Sometimes they look for both growth and income.

Fund managers usually specialise in one of three areas:

Institutional Fund Management - where the fund manager works on behalf of an organisation, such as an insurance or pension company.

Retail Funds - where money is collected together from thousands of individual savers and used to buy a portfolio, such as unit trusts sold by banks and insurance providers.

Private Client - where the fund manager deals with individual wealthy investors, managing all aspects of their investment.

Fund managers can manage a wide variety of different types of funds. Many specialise in sector commodity funds such as technology and telecommunications or pharmaceuticals. Others specialise in particular regions such as UK, Europe, Far East or global funds.

Fund managers work in teams, which are usually made up of:

Research Analysts - who provide detailed industry and company analysis, enabling better financial forecasting and share valuations.

Portfolio/Fund Managers - who decide in which assets a fund should be invested.

Client Relationship Managers - who explain and discuss decisions with the customer - for institutional funds this usually involves attending and making presentations to senior personnel and trustees at board meetings.

Depending on the size and structure of a fund management firm, a fund manager may undertake two or even all three of these aspects.

Fund managers usually work Monday to Friday, from 8am to 6pm. The job can be very pressurised and at times the working hours can be longer than this. Many arrive at work early to read the business news, catch up with correspondence and meet with analysts to try and predict what the markets will do. There is occasional weekend work.

The work is largely office based. Experienced fund managers may spend up to 40 per cent of their time with clients. This may involve overseas travel, particularly if working for one of the large global investment houses.

Starting salaries for fund managers are around £26,000 a year.

Trainees usually receive an end-of-year bonus, which can boost salaries by 15 to 33 per cent, depending on the funds and their level of responsibility.

Getting Started with this Career Choice

Many fund managers work for global banks and fund management companies. They can also work for pension and insurance companies, for investment houses or stockbrokers. Most fund managers in the UK are based in London and Edinburgh, with a few opportunities in Glasgow, Leeds and Liverpool. The UK is the leading European fund management centre.

Fund management is an unpredictable job sector that follows the fluctuations in the global economy. Despite this there is fierce competition, with more applicants than jobs every year.

Many of the large employers recruit at graduate career fairs. Employment opportunities are also advertised in specialist sector publications, in the national press such as The Times (on Thursdays), by dedicated recruitment agencies for financial careers and banking positions, and on specialist websites such as www.efinancialcareers.com.

Education and Training

Most fund managers have a first or upper second degree and A levels/H grades, or equivalent qualifications. For a degree students usually need at least two A levels/three H grades, and at least five GCSE's/S grades (A-C/1-3). Subjects such as accountancy or economics are useful, but generally employers accept a degree in any subject. Employers also expect an interest in current affairs and their effects on the financial markets. Knowledge of a foreign language may be useful if applying to an international institution. Increasingly, fund managers also have postgraduate qualifications such as an MSc or MBA in relevant subjects.

Summer internships before the last year at college or university can help with gaining a place on a graduate trainee scheme. Some employers offer full-time jobs to as many as 60 to 95 per cent of interns. As many as half of the applicants to larger firms have also tracked an imaginary investment portfolio.

At job interviews, individuals may have to make a presentation to an interview panel and take psychometric and aptitude tests.

For non-graduates, some fund management firms may offer structured training in an administrative, research or analyst role. School leavers should have A levels/H grades, or equivalent qualifications, but generally applicants can expect to achieve promotion faster if they have a degree.

A Few More Exams You Might Need

Most graduates spend their first year with a research team. Employers usually provide training on the job, working alongside a senior research analyst. The training includes a thorough overview of the business.

A fund or investment manager must be registered with the Financial Services Authority (FSA) as an Approved Person. The FSA is the regulatory body for the financial services industry, and employees are often expected to sit an examination from the Financial Services Skills Council's (FSSC) appropriate exam list within six months of joining a company. Appropriate exams in investment management are offered through awarding bodies such as the Securities & Investment Institute (SII) and the United Kingdom Society of Investment Professionals (UKSIP). These qualifications are designed to give a good understanding of the industry financial regulation and code of ethics. They are compulsory in many jobs. Training is available through specialist financial training companies or as home study courses.

Employers are responsible for making sure candidates can work unsupervised and fulfil the criteria set by the FSA.

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Skills and Personal Qualities Needed

A fund manager needs to:

Be self-confident.
Have good communication skills.
Have an eye for opportunities and be able to make informed decisions quickly.
Have a good memory for facts, events and news, and be able to link these together.
Have strong analytical, numerical and literacy skills.
Be a team player.
Possess strong persuasive skills.
Be self-motivated, and work well under pressure.
Have a strong understanding of the financial markets and be well informed about all the activities affecting their specialised sector.
Be credible and trustworthy, with the courage to admit to mistakes.
Demonstrate their dedication and have a commitment to learning.

Your Long Term Prospects

With two or three years' experience, fund managers may be encouraged to study for higher qualifications, such as the Securities & Investment Institute Diploma. This qualification takes on average between 18 months and two years to complete. With three years' experience and this qualification, individuals may earn the status of Fellowship of the Institute.

There may be opportunities to work abroad, as most global banks and fund management firms have offices in key financial centres, such as New York, Tokyo and Sydney, and in the main European centres of Paris, Frankfurt, Milan and Madrid.