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You want your money to work for you. However, saving yields nothing, and investing yourself is difficult and time-consuming. If you want to put your assets in motion but don't have the inclination or time to invest yourself, asset management is a good option. What asset management is, what the difference is between asset management and investing yourself, and what the advantages of asset management are, you can read in this article.
An asset manager invests your assets with the goal of achieving positive returns. The asset manager can be an individual or a company. Previously, you could only have your assets managed with a high initial investment, often starting from €100,000. Nowadays, this is no longer necessarily the case. With some providers, you can start from as little as €50.
If you want to delve into different exchanges, market history, stocks, and other financial instruments, investing yourself is suitable for you. You must also regularly take the time to trade and keep track of your investments.
An advantage of investing yourself is that you choose your own investments. You put together your portfolio with a mix of investments that suits your financial situation and investment goals. For example, think of different stocks, ETFs, bonds, and other financial instruments.
However, investing yourself also entails risks. In practice, it even rarely seems successful. Research shows that the average investor achieves barely any positive return in the long term. Investment experts therefore often agree on one thing: you can only successfully invest yourself if you have sufficient knowledge and time. Additionally, it is important not to invest based on emotion. And that is precisely a pitfall for most DIY investors.
Asset management is suitable for people who want to invest their money but do not have the inclination or time to delve into it themselves. If you have your assets managed, you often have to give a small percentage to the asset manager. These costs are called management fees. However, the achieved return often yields (much) more than the costs incurred. The nice thing about asset management is that you don't spend any time on it yourself. This way, you let your money work for you without having to do anything.
Below you can read the four things a (good) asset manager does for you when you have your money managed.
Diversification of your investment portfolio is crucial for success. Diversification is the spreading of your investments across different financial instruments, countries, regions, and sectors. If you invest yourself, you have to choose the mix of investments that suits the risk you want to take. If you engage an asset manager, they do this for you.
The value of your portfolio changes regularly. For example, the shares in your portfolio may suddenly be worth more than your bonds. As a result, you take a significantly greater risk than you had intended beforehand. That is why rebalancing is so important. When you rebalance, you bring your portfolio into balance by trading investments so that your mix again matches your preferences. An asset manager does this for you based on your financial situation and ambitions.
Do you have a specific investment goal? Then, the closer you get to this goal, you can invest more safely to become more certain of your target amount over time. This is called risk reduction. For example, you can gradually replace the number of shares you own with bonds. Shares often have a higher risk profile than bonds. In theory, your portfolio thus becomes increasingly safer. Risk reduction is a time-intensive process that an asset manager takes off your hands.
Some asset managers give you personal plan advice. They look at your plan and try to achieve your investment goal even more efficiently or quickly. Or, if the economy changes, they review the options with you to adjust your plan so that it continues to align with your wishes and goals.
The conclusion is simple: do you have the ambition to delve into financial markets and invest time in keeping an eye on the market? Then investing yourself is a good challenge.
Do you prefer your money to be well-invested, without having to put in time and effort? Then you'd be better off looking for an asset manager. Have your assets managed by Vive and:
1. Get an investment strategy that perfectly suits you
2. Have this investment strategy executed professionally for you
3. Always remain in control of all your investments, without having to actively do anything yourself