Asset Management

Asset marketing is the process of dividing a portfolio into major asset categories such as cash, stocks, real estate, or bonds. In doing this there are three main strategies which are:

1.? Strategic Asset Allocation
2.? Tactical Asset Allocation
3.? Market Timing

Strategic asset allocation:

This focuses on designing a portfolio of investments that is suitable for your needs and sticking with that allocation through all market conditions.? Once an asset marketing to stocks, bond, real estate, and cash is set, it remains in place for a long period of time.? Due to the market always moving up and down a strategic asset allocation will get off target over time.? It is suggested that an investor should put their portfolios back on track with the original target mix from time to time, this is called re-balancing.? Re-balancing keeps a portfolio in line with an investor's goals and objectives, and helps control investment risk.

Tactical asset marketing:

Tactical asset marketing involved forecasting asset-class returns and increasing or decreasing commitment to an asset class based on the forecast.? Return predictions may be a function of fundamental variables, for example economic variables, technical variables, forecast of inflation, recent price trends, earnings or interest-rate forecasts, or a combination of several variables.? A tactical asset allocation is mainly based on these predictions.? Tactical Asset Marketing is also known as Active Portfolio Management.

Market timing:

This is tactical asset marketing taken to the extreme.? It involves forecasting asset returns and making "all or none' asset-class bets.? A market timing strategy may start the year 100 percent in Treasury bonds and end the year 100 percent in stocks.

No on likes losing money, and no one likes to be out of a bull market.? Market timing solves both of these problems. Although some investors may believe that there are strategies that will allow them to successfully weave into and out of the markets, the facts show that few people actually do so, and those people may be lucky rather than good.? Market timing is not recommended by the professionals.
No one knows which of these three will work well.? But the best bet is to keep a well-balanced multi-asset-class portfolio that maintains a strategic allocation over time.

Raj Selvaraj is an expert in finanical matters. He has worked many years in the Finance business. He has written many articles on finanical matters and his latest article on asset management can be found on www.managementasset.org.

Understanding Asset Management

Asset management is a form of investment management. The term asset management is sometimes used to refer to the management of all investments, including assets, or it may be used to refer to assets that don't fall under the more standard categories of investment management, fund management or portfolio management.

Asset management is one facet of the vast global investment management industry. Large financial institutions manage billions of dollars in assets for businesses and individuals all over the world.

Many insiders feel that independent firms are more successful and more dynamic in investment management than are large banks and insurance companies.

Asset management helps to protect and grow investments. The assets under management may be a large company's pension fund, or an individual's retirement savings. Institutions that manage assets have great weight in the financial markets because of the amount of funds under their control. The decisions these companies make as to how to invest and move around the money they control can affect the overall rise and fall of financial markets.

Pension funds accounted for more than $15 trillion of funds that were under asset management in 2004. In comparison, more than $30 trillion of private wealth was in investments in 2004, about one third of which was being managed by investment management firms. Asset managers in the United States account for almost half of all funds under management globally.

Understanding asset management is a complicated topic. If you have large investments, you want to make sure your assets are properly managed. Various financial advisors can provide information about the best fund managers, the institutions with the best track records, and in general the type of management that may be right for you or your business. Different types of financial management are indicated, depending upon the size of the investment capital, the form of the assets, and many other individual factors.

Luke Perry is a writer and administrator for Asset Management West a site that specializes in asset management.