Welcome back to another issue of ‘Career Guides Weekly’ by Career Guides.

If you’re interested in the world of finance, specifically on the buy-side, then today’s issue will be of particular importance to you.

Today we’re talking about consulting careers. But not just any consulting career. We’re focusing on investment consulting - something you’ve probably rarely heard of.

They’re not the usual McKinsey’s or PwC’s of the world i.e. management consultants or professional services firms but they play a big role in how asset managers are able to invest client capital.

With that, let’s dive in!

What Is Investment Consulting And What Do Investment Consulting Careers Entail?

Investment consultants are a specific type of consultant who specialise in advising institutional investors (pension funds, endowments, foundations, and wealth management firms) on their investment portfolios.

In layman terms, investment consultants tell the clients of asset managers which asset manager’s funds and portfolios are worth investing in and which aren’t.

They go around from asset manager to asset manager assessing, reviewing and carrying out a ton of due diligence (research) on the asset manager’s funds (portfolios that clients can invest in) and end up giving these funds a rating (think A, B, C, D, etc.). These ratings are then shared with clients before considering asset managers to invest with.

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Introduction To Asset Management

Here’s a breakdown of what investment consultants do on a day-to-day basis and what their roles and responsibilities include:

1. Portfolio Analysis and Design

Figuring out and assessing their client's investment goals, risk tolerance, and time horizon to design customised investment portfolios aligned with their objectives.

2. Asset Allocation Strategy

Developing strategic asset allocation plans by determining the optimal mix of asset classes (stocks, bonds, real estate, alternatives, etc.) based on market conditions and client preferences.

3. Manager Selection and Due Diligence

Evaluating and selecting investment managers or funds across various asset classes.

Conducting thorough due diligence on investment managers to assess performance, track record, investment philosophy, and risk management processes.

4. Performance Monitoring and Reporting

Continuously monitoring investment performance, conducting periodic reviews, and providing detailed reports to clients on portfolio performance compared to benchmarks and objectives.

5. Risk Management

Identifying and managing investment risks by implementing risk mitigation strategies and monitoring market risks, liquidity risks, and other relevant factors.

6. Market Research and Trends Analysis

Keeping clients informed about market trends, economic indicators, regulatory changes, and emerging investment opportunities to help make informed decisions.

7. Strategic Advice and Consulting

Offering strategic guidance on complex investment decisions, asset allocation shifts, and adapting investment strategies in response to changing market conditions.

Prominent investment consulting firms (I’ve linked them to their career pages) in this space include:

1. Mercer

2. Aon

3. WTW (Willis Towers Watson)

4. Cambridge Associates

These firms play a crucial role in guiding institutional investors to optimise their investment decisions, achieve diversification, and maximise returns while managing risks in their portfolios.

So, the next time you hear 'consulting' be sure to know the term encompasses many different types of consulting including:

1. Investment Consulting

2. Management Consulting

3. Strategy Consulting

4. Financial Consulting

5. And more!

With that, hopefully you’ve learnt something new about consulting careers, thanks for reading and I’ll see you in the next one.

Best,

Afzal

PS. If you aren’t already, you can follow me on LinkedIn for daily posts on career tips and insights. Just hit the button below 😀

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