AUM reporting

When an asset manager manages a pooled amount of money from various clients, the total invested sum is termed Assets Under Management (AUM). The total value of the assets or investments in a hedge fund, mutual fund, portfolio manager, wealth manager, or another financial service firm provides. Asset managers primarily rely on the process of AUM reporting to enlist all the accounts they manage with their market values, excluding any unmanaged assets. 

The report includes asset class data by investment products, security asset class, and security holding asset allocations. So, you should know the role of an asset manager and their importance in reporting AUM.

AUM reporting

Reporting professionals use market-leading software to monitor the asset performance, yield and net cash flows across different business structures. With an AUM report in access, asset managers can perform the following central functions:

  • Attributing the AUM according to outflows, inflows, investment performance and transfer
  • Predicting client profitability throughout the lifecycle
  • Estimating actual versus expected fees
  • Structuring data according to business operations
  • Helping investors make decisions according to the required changes

It aggregates AUM data across multiple platforms while controlling checks to ensure data completion, standardisation and preparedness for use. With daily, monthly or real-time aggregation, reporting delivers crucial information asset managers need to perform their functions.

What is the role of an asset manager?

Asset managers are responsible for maximising client profitability through asset analysis and pricing. They create AUM reports and pass them to the decision makers to help them judge the situation more clearly. These are a few of the duties of an asset manager:

  • Maximise profitability
  • Run and analyse asset inventory
  • Communication with asset owners to obtain them at the best price
  • Decide and invest money for upcoming assets
  • Work with the latest asset management systems and technologies for tracking
  • Ensure accuracy and newness of the financial records for higher returns
  • Report on finance¬†
  • Forecast budgets

The primary objective of asset managers is to monitor and manage their client’s assets and financial products, including money, stocks, bonds, shares, equities and commodities. They aim to maximise their client’s ROI and ensure each asset improves financial stability and income.

Simply put, asset managers manage financial assets for companies and individuals. They are responsible for making well-timed investing decisions for their clients to increase their finances and improve their portfolios. When working with several assets and investors in the AUM, asset managers aim to diversify their portfolios. They offer higher profit options with better capital appreciation prospects while mitigating the risks involved. They may channel the pooled AUM into shares, property, bonds and other assets according to the client’s financial objectives.

How does an asset manager work with AUM?

Asset managers serve the investment requirements of their individual and institutional clients. When individuals invest money into an asset, they typically place their money in the money market fund that delivers greater returns than regular savings accounts. Asset managers have double-sided goals – mitigating risk and increasing value. That means measuring a client’s risk tolerance level is the first question they pose. For instance, retired people who depend on portfolio income for a living have a low-risk tolerance, while young and adventurous people can take more risks in their investments. If clients are somewhere in the middle, asset managers use AUM reporting to identify their client’s needs and invest their money according to their risk tolerance level.¬†

An asset manager’s responsibility is to determine where to invest and which assets to avoid. The investments may include commodities, mutual funds, bonds, stocks and alternative investments. At the same time, they must keep their client’s financial goals in mind within their risk tolerance. With rigorous research, analytical tools and AUM reports, asset managers analyse asset statistics, review its financial performance, and help clients achieve their goals with maximum asset appreciation.

Asset managers initially meet the clients to determine their long-term financial goals and understand how much risk they are willing to accept. From there, they use AUM reporting to propose assets matching their objectives. They create client portfolios, keep track of the day-to-day changes as required and communicate regularly to gain the best results.

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By Jack

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