Quick guide to asset management

Asset Management Company is a service provider company which invests its client’s capital into different markets such as stock exchange, real estate, government issued bonds etc. Apart from large investors with high net worth they also create a mixed investment pool for their small scale investors which are also known as mutual funds. Asset management company is also referred as money management company, investment company or mutual fund company.  Asset management company in Dubai helped the small scale businesses or investors to grow a lot and create their wealth.

  • How does the asset management company work and invest? 

 Since they have so much capital to invest from different clients, they also have large options to invest on which an individual investor cannot access or they cannot manage to evaluate every possible option. Asset management company also get discounts on bulk purchases of shares, debentures, bonds etc. They generate their revenue by different methods.

  1. They charge a fixed amount of fee from their clients, example charging 10 thousand bucks of service fee per month.
  2. In some cases they charge a percentage of total invested capital. Like they charge 3% of total investment which would be a million bucks.
  3. They also charge percentage on the profit client gets from his investment for example 5% of the profit on average of monthly revenue generated.

They also provide loan service to the companies those who want to expand their business or to those who are new and emerging companies who need to sustain through their initial period. In return they charge interest as their revenue.

Sometimes they also opt for a strategic decision to invest in developing company stocks to get high return later on or they also explore possibility of starting their own new project or not. But these decisions are based on research, data analytics and recommendations from bank and stockbroker etc. These recommendations provide a good market analysis through recent trend and future projection by taking in account of local public needs and future of country’s economy.

The basic difference between Asset Management Companies and Community Management Companies in Dubai is that they purely deal in material or investment based but community management company deals in both materials based or informal based.