Confusing Financial Terms Explained

Asset Management - The is the management of physical assets. This term refers to the professional management of investments such as stocks and bonds and also real estate. Asset management is generally for people with a very healthy bank balance. A lot of financial firms and investment banks offer this service, however there is a lot of work involved and although it maybe costly it is always best to have a financial adviser to deal with the whole process if you want good results. The investor will meet with the Asset Management team or financial adviser and discuss the goals they want to achieve. By investing you assets you give the team leeway to select where to distribute them to get the best results. The assets will not normally go to one location and often get moved from one place to another to take advantage of a strong market. Income from the assets are typically deposited into the same bank account, making it more manageable and clear as to what has been achieved.

Capital Management - This is an accounting strategy, with the prime goal being an equal level of working capital and also it currents assets and liabilities. Capital Management helps to ensure companies are meeting their expense responsibilities and also sustaining adequate revenue. Financial advisory companies can help assist your company to achieve both short and long-term health through the management of capital resources. This can involve managing inventories and accounts receivable and payable. With a good financial adviser you will be able to meet your debt obligations and operate your expenses.

Investment Management - This involves investing large pots of money to make a profit. An Investment Manager will invest the money for you and hopefully make a profit for you and also they will manage to make a profit for their organisation too, through the set fees applied. Investment Management is all about managing growth or income money that has been placed in the pots as a principal investment. This money can come from different sources like Asset Management (as explained above) or from pension funds. The contributions made to the pension fund can hopefully improve the value of the pension depending on the growth that has been generated. Also the money can come from private banks and wealth management firms and even insurance companies.

These funds can be invested in different markets. It is not just shares and bonds some investment funds will specialise in property which is a large market.

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