So you want to manage money? You dream of investing in a variety of asset classes all the way from a condo in Miami to vintage wine in Italy to an FD in HDFC Bank. A couple of weeks ago we discussed what wealth managers do. Today we try and understand what you can do to further your ambitions. What courses in Wealth Management can you undertake and what should you be studying to become a Wealth Manager?
What should you be studying? People seem to assume that you don’t need to know much to become a wealth manager when in fact you need to know a lot.
You need to know about:
• Accounting and Financial Mathematics for Bankers– It is critical for any wealth manager to understand an IPO. To understand an IPO you need to know how to read financial statements. A basic knowledge of accounting is therefore critical to be able to pull apart the three financial statements and analyse it using basic ratios. No one is asking you to create financial statements or even value companies, but being able to read and understand research reports is very important. You will also need to learn about the concepts of Time Value of Money, critical to understanding asset classes, NPV and IRR.
• Tools and Understanding Risk– What is the concept of risk and how does it affect Reward? You need to learn how to profile Risk Types, create Investment Policy Statements and Financial Planning Statements, learn how to read Macro Economic Reports, and understand Geo Political Factors.
• Types of Asset Classes– With basic knowledge of Risk and Financial Fundamentals out of the way, it’s time to apply them to various asset classes. A good course will give you a deep understanding of major asset classes like, Equities, Currencies, Fixed Income, Commodities Alternative Investments, Real Estate as well an insight into aspirational assets like Wine and Art.
• Capital Markets– Equity Markets, Fixed Income, Debt Markets and Derivatives are key to investment planning.
• Asset Allocation– Once you understand Asset classes, you need to learn how to allocated assets across a portfolio. What does that mean? Say you have a 100 rupees to allocate. How much do you put into the stock market vs real estate vs debt vs gold? The allocation will be determined by the risk profile you have created and the return you expect from your money.
• Laws and Regulations– A good investment adviser or wealth manager understands the implications of Tax Laws and regulations. Understanding taxation is instrumental in managing your client’s money effectively. A lot of wealth management also involves family wealth management as well as inheritance management.
The best wealth management courses in India will ensure that you learn and apply the above. They will also ensure you learn how to write and communicate effectively. The Imarticus Diploma in Retail Banking and Wealth Management is one of the most well known in the country. Because of its unique combination of both Retail Banking and Wealth management, you are introduced to the world of both Banking and Private Banking which broadens the scope of your careers.