The world’s most powerful allocators are largely dominated by Investment Consultants. As such, impressing these people is essential to gaining access to institutional capital and lucrative partnerships. If you don’t impress investment consultants, you could end up being left out of lucrative partnerships and never making a dime. Many fund managers have said they’ve had to’suck up’ to these gatekeepers. But is it really necessary to impress them?
The job of an investment consultant entails providing clients with professional advice on investment strategies. These professionals work with clients to identify their investment goals and recommend specific investment products based on these goals. While many investment consultants earn a median salary of $79,000 annually, a good consultant will also provide updates on investment performance and tax compliance, issue documents pertaining to investment products and vehicles, and maintain a client network. This job requires excellent interpersonal skills.
In addition to identifying high-quality managers, Investment Consultants must also make sure that their investment strategies are scalable. As with any job, past performance does not guarantee future results. Investment consultants are best served when they look for proven managers with track records that match their clients’ expectations. While delivering blockbuster returns is sure to garner attention, investment consultants also look for managers with a “robust” and “relevant” track record.
Investment consultants who make decisions for clients are called money managers. These professionals typically work for buy-side firms such as asset management firms, hedge funds, and fund managers. The majority of investment consultants are educated and have at least a bachelor’s degree in a finance-related field. Many obtain professional credentials, such as the CFA or the Certified Financial Analyst designation. These credentials ensure that professionals are capable of adjusting to the ever-changing investment environment.
Although there is little regulation and licensing requirements for investment consultants, some do have certifications. The most common one is the Certified Financial Planner (CFP). In order to be qualified, investment consultants must pass a comprehensive examination and meet certain educational standards. If you are looking for an investment consultant, make sure to read this Business Insider exposé. It provides a good overview of the differences between a fiduciary and a salesman.
Typically, investment consultants need a bachelor’s degree in finance or business. Many of them also have an MBA. They must also pass the Series 7 and 63 exams. Entry-level consultants usually don’t have much work experience, but moving up the corporate ladder will require a significant amount of on-the-job experience. For those who already have a bachelor’s degree and some professional experience, an entry-level position in a financial planning firm is sufficient.
While investment consultants may be registered as brokers, they are not required to be registered as investment advisors. Therefore, the securities and exchange commission has no jurisdiction over them. Therefore, it is important to check out the background and credentials of investment consultants before hiring one. You can also check out if a consultant has a criminal background. If a consultant doesn’t have a license, don’t hire them. And be sure to review the license of the Investment Consultant you’re considering hiring.