Portfolio Manager

Portfolio managers run investment funds, pension funds, insurance company portfolios and private client accounts. They decide how money is allocated among asset types and which specific securities to hold, within the rules and goals set for the portfolio.

Some portfolio managers follow an active approach, researching companies and markets to try to beat a benchmark index. Others follow a passive approach, aiming simply to match an index as closely and cheaply as possible.

A portfolio manager's work typically includes research, building and adjusting the portfolio, managing risk, monitoring performance and reporting results to clients or fund boards. They often work with teams of analysts and traders.

For example, the manager of a European equity fund with a target of beating a European share index might hold 60 carefully selected companies, adjusting the holdings as company prospects change.

Portfolio managers are usually judged on their returns compared with their benchmark, after fees. Many studies show that, over long periods, a large share of active managers fail to beat low-cost index funds once costs are taken into account.