For those looking for a solution to invest their savings, is asset management really worth it? Here are the items to consider.
For those who are in possession of capital and are looking for an investment opportunity on the market, they will find among the various alternatives the possibility of subscribing to a real estate or fund management. Asset Management is an asset management service offered by most banks and financial advisors to the most demanding customers who search for attractive returns. How the asset management firms support you to fullest, this is what we are here to offer you now.
You can choose between the subscription of the asset management (GPM) which invests mainly in shares, bonds, and ETFs or on that in mutual funds (GPF) defined by the legislation as autonomous assets, divided into shares, pertaining to a plurality of participants managed in the mountain.
However, it is not all that glitters is gold and it must be emphasized that it is a saving product not free from disadvantages and rather heavy burdens that can cause “erosion” of returns. Among supporters and “wary,” this guide contains all the main features that characterize asset management, with particular attention to the economic conditions that are most widely applied by banks and major asset management companies.
The considerations reported in the continuation of the discussion allow the investor to arrive at a judicious evaluation on the convenience or otherwise of asset management.
What is asset management?
Asset management should be defined ad hoc to allow the investor to assess whether or not to actually invest in this form of asset management.
Asset management is an investment contract signed between a saver and a bank or other asset management company.
The signing of the contract involves precise limits to the intermediary’s operations, including the obligation to acquire only shares, bonds or mutual funds, depending on whether it is a real estate asset management or a fund.
Investing in asset management: the advantages
In assessing the convenience of this asset management tool, it should be emphasized that investing in asset management has two significant advantages that cannot be overlooked:
- Greater transparency compared to other asset management products, such as an index-linked policy, given that the customer has the possibility of receiving a complete report on a regular basis of all the transactions carried out by the intermediary, with an indication of the quantity and prices of the securities purchased,
- Greater monitoring of the assets on which to invest, given that the client investor gives binding instructions to the manager, authorizing him to buy certain securities or forcing him not to do so.
Disadvantages and risks of asset management
In assessing whether asset management is appropriate or not, it is necessary to consider the disadvantages that this savings product often conceals.
First of all, the costs are rather exorbitant and could annihilate the expected returns in the medium-long term. They have often applied a commission of entrance, a management fee, and a performance fee. Furthermore, asset management in mutual funds results in higher management and performance fees than for securities management. The custodian bank usually provides for the application of fixed costs: 30 euros per quarter.
This is a rather “standardized” asset management product that is offered by banks and financial planners to “collect” resources on specific instruments and assets that make up a “typical portfolio” that is the same for all customers.
In fact, when answering the question asked whether asset management is valid or not, we must also take into account the amount of capital saved that we want to invest.
Asset management is suitable only for certain customers considered being “premium” with substantial financial resources (large assets) that do not have problems to immobilize and invest substantial and important figures in the medium-long term. Only for those in possession of sufficient liquidity reserves, asset management can be cost-effective and an adequate and profiled asset management product