Traditional Investment Management

Traditional Investment Management

Traditional investment management has something of a guild-like structure. Young investment analysts join investment firms where they take standard industry exams and begin to learn their trade. After a time, they may become assistants to a senior investment manager and eventually graduate to managing money themselves, for either new or existing clients. Under this guild-like model, each investment manager learns his ‘craft’ in a different way, from different people. The result is a wide range of practices and styles within the investment community.

There are common features, however, and managers in the ‘craft’ tradition will tend to emphasise the analysis of corporate accounts and the forecasting of the future prospects of individual companies, and perhaps of the whole economy. The ‘craft’ idea is that, by these methods, a good investment manager will be able to select superior investments and thus deliver performance that is better than that of the general market.

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