The funds management sector exists as those who have money and would like to invest, prefer to outsource to those who know more about investing that they do. By giving fund managers their money to reinvest, they have a higher chance of greater returns than they could by investing their money themselves. Fund managers normally trade traditional investments like shares, cash and bonds. To put this into practice, managers will research and buy shares which they believe are likely to increase in the market and thus, are undervalued. This is known as active fund management. Whilst active fund managers are highly scrutinised, it’s also highly lucrative. They are considered successful so long as they match or outperform a benchmark, such as the NZX.
Most large banks like Westpac and ANZ run funds management and superannuation schemes. As a graduate, you will learn how to research stocks and make investment decisions based on your analysis. You will also be taught how to effectively manage a portfolio of clients, monitor the markets and communicate any trends and findings. Whilst there is a lot of independence in roles like these, you will be part of a team and be equipped to succeed with regular training. It is also normal that your one up manager will require weekly updates on how your portfolio is performing.
Graduates may also consider working at trading firms like Optiver, IMC and Tibra, who are looking for the best of the best and regularly recruit New Zealand students into their Australian graduate programs.
If you are successful as a funds manager and build up a large and successful portfolio, you will be rewarded handsomely. Reputation is key in this industry, so make sure that you consistently outperform the benchmarks provided by management and it will result in substantial bonuses and career progression. Successful fund managers generally choose to advance into senior levels or sometimes decide to start their own managed fund, which is also highly lucrative.
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