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A portfolio manager is an experienced, senior level financial analyst who has the responsibility for overseeing the group investments made by a fund such as a mutual fund, hedge fund, venture capital fund, exchange-traded fund or closed-end fund.
There are also private portfolio managers who manage investments such as corporate retirement funds on behalf of individuals or organizations. The portfolio manager is responsible for meeting the organization’s investment objectives when selecting the securities that will be included in the investment fund.
What’s the Typical Job Description of a Portfolio Manager?
A portfolio manager usually spends time in the workday performing the following activities:
- Performing market research and analysis
- Attending meetings with clients, analysts or researchers
- Checking the status of various investments and the financial markets; buying or selling securities as necessary to achieve their hiring organizations’ objectives
- Observing and analyzing recent industry news
- Managing the activities of the junior or senior level financial analysts on the team
What Academic and Other Credentials Are Necessary for Becoming a Portfolio Manager?
A bachelor’s degree is a requirement for acquiring most portfolio management jobs. Relevant majors include finance, economics, accounting, statistics and mathematics. Most portfolio managers hold master’s degrees; the most desirable portfolio management jobs typically require an MBA or a master’s degree in finance.
Portfolio managers are generally required to become licensed through the Financial Industry Regulatory Authority. This is not always a prerequisite to employment, as it is typical for finance industry employers to sponsor the licensure of their financial analysts. Certification for professionals in this occupation is highly desirable. Since hiring organizations often prefer to work with candidates who have earned their certification, it can give you a significant edge in landing the most coveted portfolio management jobs.
Certification is available through a couple of different organizations. One such organization is the Academy of Certified Portfolio Managers (ACPM). This is largely an academic credential; the certification is offered through Columbia University, and it entails academic training in eight core topical niches that are beneficial for portfolio managers to be thoroughly knowledgeable about.
The CFA Institute is another organization that offers several different certification programs to consider. Their top program, the CFA program, requires a four-year investment of time to complete and involves passing three different examinations. Although many employers do seek out candidates who have invested the effort in this certification, it is not always a requirement for becoming a portfolio manager.
What’s the Usual Career Path for Becoming a Portfolio Manager?
It is typical for portfolio managers to work their way up after having gained experience in other positions in the securities industry. To impress hiring managers and land a lucrative job, a portfolio manager needs to bring significant investment expertise to the table. Most portfolio managers already have some work experience as successful brokers, traders, financial analysts or financial managers.
How Much Do Portolio Managers Typically Earn?
According to CNN Money, $121,000 is the typical median pay for this occupation. Successful portfolio managers can earn as much as $210,000 per year.
Related Resource: How Do You Become a Venture Capitalist?
We hope these insights have increased your understanding of the role that portfolio managers play in the finance industry. If you are thinking of pursuing a career as a portfolio manager, hopefully you now have a better understanding of how to go about landing a fantastic job in this lucrative field.
