By Vineet Sachdeva,
Many investors lose money in futures & options trading due to lack of knowledge, investments based on financial influencers’ advice and absence of proper risk management processes. In fact, investors’ need and greed for money is bringing them closer to the problem of ‘quick money’.
As an investor, you may find it challenging to navigate the ever-changing landscape of investment opportunities, conduct thorough research, and make informed decisions. It is imperative to delegate investment responsibilities to a seasoned fund manager as a strategic necessity. Let us understand this in detail.
Professional expertise
Fund managers leverage decades of experience in meticulously studying financial markets. Their analytical acumen encompasses a nuanced understanding of investment options, market trends, and the intricacies of potential opportunities and risks.
Time and convenience
Managing an investment portfolio demands a profound investment of time and cognitive resources. Delegating this responsibility to a seasoned fund manager is a liberating experience for investors. The fund manager, equipped with sophisticated tools, navigates market complexities with temporal efficiency.
Diversification and risk management
A cornerstone of prudent investment management lies in strategic diversification. Fund managers, endowed with access to a comprehensive spectrum of investment avenues, craft portfolios tailored to individual risk tolerances, goals and temporal horizons. Concurrently, they deploy advanced risk management strategies to mitigate potential losses and safeguard capital.
Access to exclusive opportunities
Fund managers, through professional networks and institutional affiliations, gain entry to exclusive investment opportunities such as private placements (e.g., AIFs and PMS). These opportunities, often beyond the reach of individual investors, underscore the unique value proposition that fund managers bring to the wealth creation landscape.
Emotional discipline
Amidst market volatility, emotional intelligence is a distinguishing trait of seasoned fund managers. Rational decision-making, rooted in comprehensive analysis, minimises emotional biases, and enhances the prospect of achieving enduring financial objectives.
Having a fund manager to manage your investment portfolio offers several compelling advantages. Their professional expertise, experience, and access to exclusive opportunities can help optimise your investment returns. However, it is crucial to conduct due diligence when selecting a fund manager, considering their track record, investment philosophy, fixed fee based or performance-based fee structure, and alignment with your investment objectives.
(The writer is entrepreneur partner, Quantitative Equity Investing, Alpha Alternatives)