What distinguishes independent asset managers from banks?
Banks primarily survive from the sale of financial products. Sales and commission targets are often formulated for the customer advisory service. Bank employees are specifically trained in sales techniques and offer a centrally defined and restricted selection of products. Bank employees ultimately act in the interests of their employer, the bank.
Independent asset managers have the exclusive task of structuring and managing assets in an optimal manner in line with the specifications and wishes of the asset owner. They survive based on the success of their management services. They are not restricted by sales targets or by centrally determined commission targets. The Independent Asset Manager aligns his actions to the interests of the client. Trust and reliability are the bases of the Independent Asset Manager's actions.
What amount of assets do I need to benefit from professional asset managers?
Professional asset management is often offered in a standardised form from EUR 50,000.
BPM offers a successful dividend and value oriented management approach through the inclusion of institutional product solutions for the investment of assets over EUR 1,000,000.
Is cooperation with independent asset managers safe?
Independent asset management (officially: financial portfolio management) in Germany is a financial service that is subject to authorisation.
This authorisation to manage a financial services institution is granted based on the Kreditwesengesetz (German Banking Act), an audit by the Deutsche Bundesbank (German Central Bank) and the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin - Federal Financial Supervisory Authority). Only licensed and constantly monitored financial services institutions are permitted to conduct financial portfolio management.
Usually the Asset Manager acts based on a limited banking power of attorney on the client's account and portfolio. This only authorises disposition of the account and not the removal or transfer of assets.
The respective processing bank is responsible for the safe custody of the assets and is also a member of the deposit guarantee scheme of the respective group of institutions. Furthermore, BPM has suitable pecuniary loss liability insurance.
Is independent asset management expensive?
Professional asset managers will require remuneration for their services in line with the services they provide. A fixed fee is often agreed without additional performance components to avoid conflicts of interest.
In direct comparison with bank conditions, asset manager are most often clearly more reasonable and more transparent. There are numerous reasons for this, among which the favourable, negotiated transaction fees and the dropping of hidden commissions are probably the most important.
Can I simply transfer my existing securities portfolio?
Yes, this is possible without any problems. Personal attendance or direct contact with your previous bank is not required. Independent asset managers provide extensive assistance in the processing of the necessary paperwork. An international transfer of securities portfolios is naturally also possible.
The assumption of a previous bank's mandate is also fundamentally possible but is often not the optimal solution or recommended for various reasons.
Does an Asset Manager have special conditions with regard to settlement banks?
Yes, this is the case. As the settlement bank only provides a few services it can offer more favourable pricing. Asset Managers are coveted bank partners. The special conditions are passed directly on to the clients. Appropriate agreements generally exist with the various platform banks so that the selection of the settlement platform can be perfectly matched to the client's wishes.
How can I be regularly informed about the state of my assets?
As asset owners you will be informed of each Manager transaction either by letter or electronically. Furthermore, you can agree to protected “view-only” access to your portfolio over the internet. Your Asset Manager is also always in a position to provide you with additional information in almost any desired means of communication.
Where can I obtain references?
The Federal Financial Supervisory Authority (BaFin) authorisation letter for practising financial portfolio management can be provided at any time. You can also review the registration on the internet. Furthermore, a successful and experienced asset manager always has clients who, on request, are prepared to pass on their experiences and make a recommendation.
Membership in a recognised professional association (e.g. Association of Independent Asset Managers) points to a good reputation.
The CV and an overview of previous activities of asset management employees is also an important piece of information.
The settlement banks are also available to provide information on the Asset Manager at any time, as they also carry out an intensive audit prior to doing business.
Is setting up an asset management mandate very expensive and complicated?
No. The respective Management Agreement is usually discussed and signed together with account opening at the settlement bank. Important points of the Agreement, such as the investment guidelines, the maximum ratio of the individual asset classes, the desired benchmark, or even the loss threshold, are intensely discussed and subsequently individually adjusted.
What happens if the Asset Manager or the service bank ceases their activity for whatever reason?
You, as asset owner, always have control over your assets. You can therefore end the mandate at any time, revoke the limited power of attorney, transfer the assets at any time or take any other actions. The respective service bank will accept and execute your orders. Your capacity to act is also ensured at any time and risk-free even in the event of a failure of the Asset Manager. Your deposit items are also protected in the event of a bank failure, as your securities portfolio is not liable for the institution's liabilities.
Why have not more investors previously decided for the logical alternative of "Independent Asset Management"?
The awareness and knowledge of the service spectrum of independent asset managers varies greatly in different countries. Bank sales representatives are not likely to suggest an existing and better alternative of bank-independent mandates to a sophisticated and wealthy client.
Previously, only foundations or industrial families were brought into connection with asset management companies. But in the last few years many universal and private bank specialists have left their companies in order to provide clients with actual independent and individual advice.