Portfolio management overview
A Portfolio manager (PM) oversees the management of investment portfolios for their clients. Clients include pension funds, banks, hedge funds, wealth management firms, insurance companies, charities, and family offices. The PM is responsible for maintaining the proper asset mix and investment strategy that suits the client’s needs.
The personality of someone who would thrive in a portfolio management position at an asset management firm likely has the following character traits:
- Detail oriented
- Client focused
Portfolio Management – Interview prep
Preparing for an interview in portfolio management is similar to preparing for an interview in equity research. We have organized the most common interview questions from a wide range of sources and provided the answers you need in our equity research interview guide. It would also be helpful to review macro economic interview questions as well.
A portfolio manager often begins their career as a financial analyst in equity research. With strong performance and expertise, an analyst moves up to be a portfolio manager. The PM position is typically a later stage career in investment management, so it may take several years as a financial analyst or stock picker before becoming a portfolio manager.
Portfolio Management – Exit strategy
The PM role is not a means to an end, but an end in itself. Most people remain in the role for a long time and focus on gaining more assets under management (AUM). In terms of progression, some people may take on leadership or executive roles at the firm, or they may start their own asset management firm.
Below is a range of compensation you can expect to earn as a portfolio manager. It should be noted that there can be a wide range based on the firm, the year, and your total AUM.
Junior Portfolio Manager: $200,000 to 500,000+
Senior Portfolio Manager: $500,000 to 1,000,000+
Portfolio management course work
The CFA® designation is critical for just about all buy-side investment management roles.
In terms of additional online coursework, it’s important to begin with a strong understanding of accounting fundamentals. From there you should have a solid Excel crash course under your belt, which will teach you the basics including shortcuts, formulas, and functions. Beyond that, you can progress to more advanced courses, which will teach you sensitivity analysis and industry-specific modeling. By taking a few courses, you’ll learn about various industries and see different types of models.
If you want the best value on a wide range of courses, check out CFI’s Full Access Bundle.