In the discreet world of wealth management, every word has its own weight and resonance. To fully grasp these nuances is to navigate with ease in a world where subtlety and precision shape financial success. Having explored an initial series of key terms, let’s continue our journey with some of the other expressions that are essential to success in this field.
The asset management agreement :
First and foremost, to enable your advisor to manage your investment portfolio, it is essential to sign a management mandate. This is a contract that enables your advisor to manage your assets through decision-making, which can be :
- Independent: the advisor leverages their market expertise to steer and adjust the client’s portfolio on their own. The advantage of this independence is rapid reaction to market volatility, and therefore better risk management.
- Concerted: the advisor manages the investment portfolio in collaboration with, and with the approval of, the client. This gives customers greater control over their assets, while benefiting from the advice of an expert in the field.
Investor profile :
When you meet your wealth manager, they will most likely ask you questions to define your investor profile. This refers to your ability to accept financial risk, based on your current situation and personal goals. There are several types of investor profile:
- The Aggressive profile: This profile aims to maximize profit, and therefore face a higher risk of market volatility.
- The Conservative profile: This profile is distinguished by its very low tolerance for market risks. This type of investor tends to opt for more secure investments in order to preserve the value of their capital.
Asset allocation :
Imagine conducting an orchestra: each instrument plays a unique score, but together they create a harmonious symphony. Asset allocation follows the same principle, combining equities, bonds, real estate and other assets depending on your objectives and ambitions.
Investments taxation:
Investment taxation is crucial to maximizing your returns. It lists all the tax rules that apply to your investments, and can significantly influence the investment choices you make with your advisor. Mastering the taxation of investments allows you to optimize the management of your investments, and therefore make better financial decisions and optimize your returns.
Mastering these concepts will not only give you a better understanding of your advisor’s strategies, but will also enable you to optimize your assets over the long term. It is also advisable to keep abreast of changes in the market, as it is constantly evolving.
The information contained in this article is provided for information purposes only. It does not constitute investment advice, a personalized recommendation or an invitation to buy or sell a financial asset. Before making any investment decision, you are advised to consult a licensed professional.
