Importance Of Wealth Management.

Wealth management is a service that is mostly offered by banks and financial advisors to the most demanding customers who are looking for rather personalized conditions. It is possible to choose between the subscription of real estate asset management (GPM), which invests mainly in shares, bonds, and ETFs, or that in mutual funds (GPF) defined by the law as "autonomous assets, divided into shares, pertaining to a plurality of participants managed upstream. "

In this article, you will learn the importance of using wealth management companies to secure your wealth.

• The methods of asset management

Upon signing the asset management, the client makes a contribution of money and within the framework of some more or less binding guidelines mandates the wealth management companies to manage the capital with the aim of obtaining a revaluation of the same.

Since this is a personalised investment service and not the purchase of a standard product, each client's portfolio is potentially different from that of any other and defined on the basis of an accurate analysis of their needs and investment objectives.

• Wealth management and mutual funds

The main feature of asset management is that capital management is individual. In mutual funds, on the other hand, the capital participates in a collective amount in which the individuality of the contribution is dematerialized. In asset management, on the other hand, there is an account in the name of the customer, and all transactions are registered in the name of the saver.

The saver, in fact, while granting a mandate to the manager, can indicate the characteristics of capital management, thus personalizing the relationship with the intermediary.

When investing in mutual funds, the saver cannot suggest how to use the capital to the manager but only the type of fund most congenial to him. Normally the more prepared savers who rely on asset management tend in the medium to long term to increase investment indications to their managers.

Precisely for these characteristics with the GPM, the saver is required to have a certain competence to make conscious choices and correctly address the manager.

• The advantages of wealth management

Although wealth management offers significant advantages over mutual funds, they are reserved for customers with greater economic availability. This investment method, in fact, guarantees greater transparency because the customer receives a complete summary of all the operations made by the manager with an indication of prices and quantities bought and sold.

Asset management ensures greater control because the customer, especially the more experienced one, can give binding instructions to the manager, for example, asking him not to buy a certain type of security or, on the contrary, forcing him to do so.

Without any hesitation, it is, therefore, necessary to ensure that the wealth management offered is personalized 'tailor-made.' To do this, however, investment houses require an invested capital of at least 5 million euros. Otherwise, the management is not customizable but 'managed upstream' cumulatively. The degree of risk calculated will be originally established on a one-off basis without the possibility of subsequent changes.

Another reason why wealth management services are needed is that they are ultimately designed to benefit all parties involved, which means that in many situations, the financial institution, lender and borrower make a long-term profit from the transaction.

Here the financial consultant will have to work hard to 'calibrate' money management, always analyzing and respecting the needs of the individual client, according to the personal risk that can be tolerated and the personal time horizon.

Without the use of specific and adequate questions in this sense, the customer will not be satisfied because he is served by a salesman and not by a Consultant. The resulting results will be the physiological consequence of a mere sale. Always worry if they do not ask you numerous questions before signing an investment; otherwise, you will never be delighted.

• Conclusion

Beyond the wealth management sector's banking and tax management sectors lies a complex world of investments. This area of??finance includes the stock market, real estate, corporate interests, and many other investment channels. The wealth management companies that manage these investments provide a safe and professionally supervised way to invest in markets to increase a client's net worth potentially.

Hello! My name is Pawan Dhuri. Master's in banking & finance, with over 6 years of experience in the finance industry working as a financial advisor. In this space, I am gonna share the secrets of financial wellbeing.