Investment Management Firms Key Terms
Learn the lingo to work with investment management firmsInvestment management firms are critical to everyday investing. They help businesses, non-profit organizations and private investors manage their investments. These firms often maintain a wide range of account types including hedge funds, mutual funds and pensions. Investment managers work one-on-one with investors or oversee a group of accounts, handling the investments they make. These firms must work to meet the group or individual's goals according to the risk tolerance of the investor. Most people who invest in retirement accounts or the stock market work through investment management firms.
Mutual fundsMany investment management firms offer mutual funds. These funds bring together a wide range of investors to invest in a set of stocks, bonds or other investments. Each investor maintains his or her own shares, which is part of the group's holdings.
U.S. Securities and Exchange Commission offers more information online and through publications on mutual funds.
PensionAn investment firm may manage a pension or pension plan on behalf of an individual or a company. This is a type defined benefit plan where an employer contributes funds toward the retirement of an employee.
Investment managerInvestment managers oversee the accounts of a business, city or private individual. They work within the investment management firm to provide services to the company. The individual may manage several accounts or just one, depending on experience and the account's size.
City of Phoenix provides a job description of an investment manager. The duties included here are similar to those required for all types of investment managers.
Investment portfolioAn investment portfolio is a term used to describe a number of investments an individual has. In most cases, it offers a mixture of investments. The entire portfolio may have specific goals, such as risk tolerance.
American Institute of Certified Public Accountants offers a full description of what an investment portfolio is and how it is used.
Risk toleranceRisk tolerance is the amount of risk an individual or group is willing to take on. This is often a personal decision on how much risk an individual is willing to consider in terms of investment strategies.
Copyright © 2013 Business.com, Inc. All Rights Reserved.