Working in fund administration and fund management
The funds industry manages the savings and pension investments of millions of people who combine their financial wealth so that they can invest in assets such as securities, shares, bonds or property. By pooling their wealth together, they have greater opportunities to invest in a wide range of financial products, benefiting from spreading their risk or being able to get expert advice or use specialist service providers and administrators to manage their funds.
There are a number of players in the funds industry:
• Promoters (usually banks or stockbrokers) advertise and sell funds.
• Fund or asset managers decide where best to invest the money.
• Fund administrators do all the ‘back office’ financial paperwork processing, ensuring that clients have up-to-date information on their funds’ investment performance and also that the funds comply with all necessary legal requirements.
It is the fund administration side that dominates the industry in Ireland. The Irish funds industry has investment managers from over 50 countries around the world as clients, and the services they provide on their behalf, reaches investors in some 167 countries around the world, using 28 languages.
While the industry was initially based in the International Financial Services Centre (IFSC) in Dublin’s North Docklands area, there are now funds operations throughout the Republic in places such as Kilkenny, Waterford, Cork and Limerick as companies look to set up cheaper operations and also to tap into local talent pools. It is a very young industry and this is reflected in the fact that most people working in it are in their early twenties or thirties and even senior managers can be in their mid-thirties. Women are also very well represented in the industry here.
Many of the careers available to graduates are related to the servicing of investment funds. These areas include shareholder services, fund valuations, custody, fund accounting, client relationship management, compliance, taxation and risk management.
The industry has created exciting roles in Ireland and the range of skills being employed in the funds industry continues to expand, providing an intersection of people with accounting, legal, financial analytics, IT (software and hardware), languages, communications, marketing and people management skills. There are numerous specialised courses dedicated to the funds industry and the Irish Funds Industry Association (IFIA) also run professional courses that you can do once you’ve entered the industry. Visit www.irishfunds.ie for further details.
Who would it suit?
Candidates for the funds industry will need to be methodical, good communicators and team players, who work well under pressure and can work long hours when necessary. The work requires a great attention to detail and accuracy.
While there is a high turnover of staff at junior levels, there are good opportunities to progress up the management ladder, moving from administrator to senior administrator to team leader to manager.
Many of the organisations based here are multinationals, so while most of the positions recruited to will be based in Ireland, there may be opportunities for international travel, especially in the business development, marketing or client relationship management areas, where you will be dealing with clients from all over the world.
Fund managers manage equity and fixed income funds, currency or property on behalf of clients who are looking for the greatest possible return on their investment. The fund manager is the person responsible for implementing a fund’s investing strategy and managing its trading activities. A fund can be managed by one or more people.
Clients may include insurance policy holders, investors in insurance companies, holders of unit and investment trusts and contributors to pension funds. The amounts of money involved can be quite considerable and the responsibility is great because poor investments can lose clients’ money. Fund managers should understand world business and financial affairs and be capable of evaluating complex financial information; they must also be aware of trends and current activity in the financial market.
Who would it suit?
The individuals involved in fund management (mutual, pension, trust funds or hedge funds) must have high educational and professional credentials and appropriate investment managerial experience to qualify for this position. To become an investment fund manager, you would therefore generally need extensive financial management experience. Most people start their career as an investment analyst or as a trainee fund manager, progressing to fund manager over a number of years.
The whole point of a client investing in a fund is to leave the investment management function to the professionals. Therefore, the quality of the fund manager is one of the key factors to consider when analysing the quality of any particular fund. Famous fund managers include George Soros, Chairman of Soros Fund Management, LLC who famously ‘broke the Bank of England’ in 1992 by betting successfully against sterling, making over US$1.8 billion for his fund in one week!