Guest article by Thomas Fischer, Managing Director of our German subsidiary Wydler Asset Management (Deutschland) GmbH:
When is an asset manager worthwhile?
From our experience, we know that many investors are very unsure whether and when they should contact an asset manager. Sometimes there is even a certain inhibition, not to say fear. Isn’t an asset manager a contact point only for the super-rich, for multimillionaires? For whom is an asset management suitable and when does it make sense at all? We would like to take a closer look at these questions here.
What is an asset manager?
If you as an investor do not want to and/or cannot manage your money yourself either due to lack of time or lack of know-how, it is possible to assign this task to an asset manager. Ideally, the asset manager you choose is completely autonomous, independent and thus free of the usual banking constraints. If he is licensed and regulated by the state supervisory authority (FINMA in Switzerland and BaFin in Germany), you definitely have a reliable, financially strong and reputable service provider on board as a partner.
How is this different from a consultant?
An investment advisor will tell you about various options for investing your capital and will take the appropriate steps once you have made your decision. In contrast, an asset manager takes the decision away from you, when your capital is invested where and in which order of magnitude. Within the framework of a limited power of attorney, he invests your assets in securities, permanently monitors the individual positions and adjusts them to your ideas depending on the market situation. The strategy and risk profile of the investments are clearly defined in advance and implemented accordingly as stipulated in the asset management contract.
Do I have to be a millionaire to afford a wealth manager?
In fact, many asset management companies insist on a minimum investment amount in order to accept you as a client. We think this is a pity, because even “smaller assets” should be able to experience the possibility of professional support.
If you are flirting with investing in individual stocks, it makes sense to have sufficient financial resources to allow a reasonable spread of risk. It makes no sense to build up individual stock positions in only small offsets; the costs of doing so bear no relation to any potential return. Funds, on the other hand, inherently offer broad risk diversification and are a sensible alternative even with a low capital investment.
A good asset manager can also offer you savings plans with which you can build up assets over the years (possibly in addition to an initial one-off amount).
Simply get in touch. A personal discussion will quickly reveal whether an asset manager is a good fit for you and can offer you not only the “right chemistry” but also what you are looking for.
How much does an asset manager cost?
In the age of digitalization, there are of course also many electronic variants of asset management on the Internet, which are also known as robo-advisers or fintechs. Technically simple in design, some of them allow users to buy “professional asset management” for very small amounts. However, these providers often fall short of the performance of an investment managed by real financial professionals. There is simply no such thing as a machine or program that can permanently deliver maximum returns for incredibly low fees. The fees of a traditional asset manager are usually between 0.75% and 2.0% of the assets under management, usually also depending on the total amount as well as the complexity of the individual investments. What may sound like a lot at first is quickly put into perspective if your asset manager makes the right decisions and can save you from horrendous losses, especially in times of crisis.
What are the goals of an asset manager’s clients?
According to a study by the consulting firm Ernst & Young (EY) in 2021, financial security is the most important goal of a typical high net worth individual. Directly behind is capital protection/capital preservation, followed at some distance by the desire for a broad diversification of invested assets.
Apparently driven by dissatisfaction, customers are turning away from their principal bank and looking for a new haven for their capital. According to the Institute for Asset Management at the Technical University of Aschaffenburg, savings banks and major banks in particular are losing customers to private competitors in 2021. In the case of asset managers, both the number of customers and assets under management have been rising sharply for years. Individual support, accessibility and high service levels continue to attract customers.
What are the benefits of having an asset manager?
As already mentioned, a good capital investment requires professional skills and, above all, time. The unconditional will to permanently deal with the markets must be given. Those who do not want to or cannot do this, are in the right place with an asset manager, because he offers:
Expertise -- specialists take care of the appropriate investment of your assets, always individually tailored to your personal situation and your personal risk tolerance.
Flexibility -- the ability to adjust your investments to changes in your life. Marriage, children, change of job, divorce, relocation, purchase of real estate, death, occupational disability -- just a selection of issues that can have a lasting impact on your investment. Short notice periods should be given.
Independence -- Bank-independent managers will not “sell” you complex and incomprehensible products, they are autonomous, independent and only with you on board. Because at the end of the day, it’s not about a bank making money, it’s about you, the client, making money.
Professionalism -- a good asset manager will manage your investments professionally, meaning unemotionally, and exclusively in your interest. He will inform you about all opportunities, but also about risks and costs and will advise you against investments that are not suitable for you.
Transparency -- You will be kept up to date with the latest developments, at least quarterly, but more often by arrangement. You know how your investments are performing and you also have a clear view of costs. A good asset manager always pays off for you, just like a good tax advisor.
Time -- next to health, perhaps the most important commodity and nowadays a real luxury. Your asset manager takes everything off your hands that you would normally have to invest time in, giving you the opportunity to concentrate on the things in life that are important to you.
If you cannot or do not want to actively take care of your assets, then you should consider professional assistance. A good asset management offers you a time-saving, professional and convenient solution for your capital. Do not be afraid to request information or to arrange an initial, non-binding meeting (if necessary, from the comfort of your home via video conference).
At the end of the day, it’s about you and your money!
This document has been designed and produced by Wydler Asset Management AG, however, we do not assume any liability for the topicality, correctness and completeness.
The information has been compiled and prepared with the utmost care and has been obtained from our own or publicly available sources believed to be reliable. Own representations and explanations are based on the respective assessment of the author at the time of their preparation, also with regard to the current legal and tax situation, which may change at any time without prior notice.
The contents of this document do not constitute a recommendation for action, nor do they replace individual investment advice or individual, qualified tax advice. The information presented does not constitute a decision-making aid for economic, legal, tax or other advisory issues, nor should investment or other decisions be made solely on the basis of this information. In particular, it does not constitute a recommendation, an offer, a solicitation to buy/sell investment instruments or to engage in transactions or other legal acts.
Wydler Asset Management AG assumes no liability for any damages or losses arising directly or indirectly from the distribution or use of this document or its contents. The graphs or indications of performance illustrate past performance. Future values may be lower as well as higher.
The reproduction, adaptation, distribution and any kind of exploitation outside the limits of copyright are reserved only for the Wydler Asset Management Group, exceptions require the written consent of the company.
For detailed product-specific information and notes on the opportunities and risks of our funds, please refer to the current sales prospectuses, the investment conditions, the key investor information and the annual and quarterly reports, which you can obtain from us free of charge in German. These documents form the sole binding basis for the purchase of the funds.
Status of all information, representations and explanations: July 1, 2021, unless otherwise stated.
Wydler Asset Management AG, Korporationsweg 13c, 8832 Wilen b. Wollerau, Schweiz
Tel. +41 44 575 18 11, www.wydlerinvest.ch, E-Mail: firstname.lastname@example.org, Chief Executive Officer: Frank Ramsperger
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