What is the difference between a fund manager and a fund accountant based on their job role? Which one has a better career graph? Please help.

Updated on : January 17, 2022 by Emilia Stone



What is the difference between a fund manager and a fund accountant based on their job role? Which one has a better career graph? Please help.

Basically, a fund manager is an outsourced third-party service provider that protects the interests of investors. You have to independently verify the assets and the valuation of the funds. Since he is the outsourced person, fund managers are free to focus on portfolio management internally. The Fund Accountant is purely providing accounting for a portfolio of investments such as securities, commodities and / or real estate held in an investment fund such as a mutual. funds or hedge funds ...

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The fund manager is an executive / managerial role with responsibility for the performance of the fund, while the accountant position is an operational role that reports to the executive. Both require different skill sets and educational / experience backgrounds. If you can carry a fund on your shoulders by improving track record, the career chart can be linear with increasing AUM (assets under management), client base, and amount of funds.

Here are some good answers. It feels great to work with highly accomplished competitors. It's inspiring to see others try their best for the sake of a deal and push yourself in the same way. It is extremely valuable to have a behind-the-scenes view of the business, learn and apply valuation principles, and understand how transactions are conducted.

I think there are also some other things that drive people to investment banking:

Why People Start With Electronic Banking

1. Prestige. In New York City, being an investment banker is considered, at least by investment bankers and their friends (note, I

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Here are some good answers. It feels great to work with highly accomplished competitors. It's inspiring to see others try their best for the sake of a deal and push yourself in the same way. It is extremely valuable to have a behind-the-scenes view of the business, learn and apply valuation principles, and understand how transactions are conducted.

I think there are also some other things that drive people to investment banking:

Why People Start With Electronic Banking

1. Prestige. In New York City, being an investment banker is considered, at least by investment bankers and their friends (note, I was an investment banker), as a very prestigious profession. To be a bit crude, it's an easy profession with which to impress girls in bars, to say the least. I found this only really works in New York, as at home in Texas, no one was impressed unless you were a lawyer.

2. Path of least resistance. Note that as a former investment banker, I am a bit biased here. I believe that many kids go into investment banking because, for many, it is the path of least resistance.

Sure, it's a competitive field where everyone works crazy hours and it's hard to get the job in the first place, etc. But it's also a great field to get into immediately after college, because it doesn't require a huge skill set, and it's easy to transition into pretty much anything afterward. Everyone knows that investment bankers work very hard and most people realize that they are probably quite smart too. You can move on to most other areas of finance from banking, and in fact my mentors on the buying side told me to go banking first. You can also transition to completely different industries; I know bankers who went into fashion, for example.

So for me, graduating from an ivy league school, it was a no-brainer to get into investment banking, because essentially it was the only path I could go down and it didn't seem like a risky decision.

As a college student considering e-banking, you know that you will work hard and everyone will know it. You know that you will earn a relatively large amount of money. And you know that you will learn a lot about business from at least one perspective.

Add to that the fact that, (from Columbia) almost everyone else wanted to get into finance, and it seemed like a pretty safe bet.

Once you're inside, the easiest decision is to stay.

Why people work hard on e-banking
Again, there are many positives about e-banking. It's great to be part of a team of smart, motivated people who give their all for a deal. This is the reason why no one speaks.

1. Fear. Once you're in the machine, the scariest thing you can imagine is getting kicked out of the machine.

There is a psychological principle that the more you work for something, the more you will value it. I found that as an i-banker, this phenomenon was very powerful. Think about it: you just worked a hundred hours a week. This really sucked. Only an idiot would work 100 hours in seven days if it wasn't worth it, right? And you are not an idiot! So it must be worth it.

This bias is manifested in the language that people use in the industry to describe their abandonment. If you stop investment banking, for whatever reason, you "burn out." This could be because you had a sick relative, decided you wanted to pursue a lifelong dream, or found a job that only required 70 hours a week - it doesn't matter. You are a burnout, a stress management warning.

For example, I was once in an interview at a high-profile company and I was there to replace an analyst who had left investment banking to become a full-time writer. I thought it was a story of incredible courage: I was leaving a stable, well-paying job to pursue a lifelong dream. However, the Managing Director was disgusted by the Analyst's decision, and his disdain was mirrored by everyone else at the firm.

Former colleagues of this type, who had slaved alongside him on one deal after another, his bosses, whom he had put in between 8-10,000 hours in the past two years, now spoke of him as a failure. Plus, it was someone who had screwed them up, because now they had to hire someone else. They literally shook their heads every time they talked about him.

So I am not trying to dissuade anyone from joining investment banking; There are things I learned from that profession that have had profoundly positive effects on my life. Hell, I still do investment banking work, just on my own terms.

I think it's worth talking about some of the reasons people go into banking and stick with it, to make sure potential bankers have all the information.

* I'm going to explain things so non-finance people understand them, without any technical jargon. * ... The only "requirement" is: intuition. For all other qualifications (not "requirements"), it depends on the fund. I was a quant trader in a hedge fund with over $ 6 billion AUM for a few years. I've seen all kinds of people come and go. In general, hedge fund managers have degrees from prestigious universities and are one of the most knowledgeable people in the areas in which they operate (healthcare stocks, gold, coffee, oranges, oil, retail stocks, currencies, etc.) . But technically

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* I'm going to explain things so non-finance people understand them, without any technical jargon. * ... The only "requirement" is: intuition. For all other qualifications (not "requirements"), it depends on the fund. I was a quant trader in a hedge fund with over $ 6 billion AUM for a few years. I've seen all kinds of people come and go. In general, hedge fund managers have degrees from prestigious universities and are one of the most knowledgeable people in the areas in which they operate (healthcare stocks, gold, coffee, oranges, oil, retail stocks, currencies, etc.) . But technically speaking, there are no "requirements" to be a "hedge fund manager" other than certain licenses and certifications, that most people who work in finance on both Wall St. and Main St. must have anyway. so there is nothing new there. And unlike the SEC's definitions for becoming an "accredited investor," there are actually no net earnings / income / prior experience restrictions to becoming a "hedge fund manager." It's about your ability to win from profit and loss for your clients and your ability to attract new investors (being online helps). You can be a gifted 12 year old with amazing abilities and manage your own fund with $ 900MM AUM generating 40% return. You may be a 40-year Stanford PhD graduate managing a fund with just $ 100K AUM left with a profit and loss trend line that falls faster than the Obama voter confidence rating. Both are considered "hedge fund managers" except that one is winning and smiling and the other is about to become unemployed. It's about your ability to win from profit and loss for your clients and your ability to attract new investors (being online helps). You can be a gifted 12 year old with amazing abilities and manage your own fund with $ 900MM AUM generating 40% return. You may be a 40-year Stanford PhD graduate managing a fund with just $ 100K AUM left with a profit and loss trend line that falls faster than the Obama voter confidence rating. Both are considered "hedge fund managers" except that one is winning and smiling and the other is about to become unemployed. It's about your ability to win from profit and loss for your clients and your ability to attract new investors (being online helps). You can be a gifted 12 year old with amazing abilities and manage your own fund with $ 900MM AUM generating 40% return. You may be a 40-year Stanford PhD graduate managing a fund with just $ 100K AUM left with a profit and loss trend line that falls faster than the Obama voter confidence rating. Both are considered "hedge fund managers" except that one is winning and smiling and the other is about to become unemployed. You may be a 40-year Stanford PhD graduate managing a fund with just $ 100K AUM left with a profit and loss trend line that falls faster than the Obama voter confidence rating. Both are considered "hedge fund managers" except that one is winning and smiling and the other is about to become unemployed. You may be a 40-year Stanford PhD graduate managing a fund with just $ 100K AUM left with a profit and loss trend line that falls faster than the Obama voter confidence rating. Both are considered "hedge fund managers" except that one is winning and smiling and the other is about to become unemployed.

Having elite ratings will certainly help you find new investors, but it is certainly not a "requirement." In fact, one of the most famous hedge fund bankruptcies in the industry was led by an elite group of doctors, one of whom was the creator of one of the most important financial models. Read about it here: Long-Term Capital Management

But if you want to become a SUCCESSFUL hedge fund manager, (in my opinion) you should definitely be well versed in how the financial system works, and you NEED to be a prolific news reader, even if you are not hosting an event. -Strategy driven. But even then, by the time the reporter writes the story, it would have taken you too long to react to the market (unless you're using inside information, but I don't recommend that strategy). Therefore, the only real requirement is intuition. Intuition is based on knowledge. When you read news about Bloomberg that came out 10 minutes ago, you need to perceive how it will affect the market 10 days later, so that 10 days later, when the news comes out, it will be OLD NEWS for you. You need to have that seemingly magical ability to analyze and prophesy. A knack for assessing risk and probability would not be

The fund I worked for made its money by using algorithmic trading, which is probably not your general notion of a "hedge fund." We didn't really care if Apple announced it was acquiring Samsung, or if Mark Zuckerberg suddenly quit and became a porn star. We operate primarily by writing computer programs to analyze millions of data points per second and then automatically placing a buy / sell order before the next second arrives, every 1/10 of a second counts. Most of the people on my team had PhDs in physics, mathematics, or computer science from Stanford, MIT, Carnegie Mellon, Columbia, Princeton, Harvard, etc. of them, intensive courses in basic finance. One man even had a doctor (he eventually went to work in a health care hedge fund). Many had written research articles on machine learning and network latency. I was one of the few on the team with only a bachelor's degree in computer science, which made the transition a bit difficult for me (I had to go back and read a physics textbook) since sometimes I don't I had an idea of ​​the equations my colleagues were talking about. upon. One guy even incorporated the formula for finding Earth's gravity into an algorithm for trading the US / JPY currency pair. He made a lot of money with that algorithm. One guy even incorporated the formula for finding Earth's gravity into an algorithm for trading the US / JPY currency pair. He made a lot of money with that algorithm. One guy even incorporated the formula for finding Earth's gravity into an algorithm for trading the US / JPY currency pair. He made a lot of money with that algorithm.

That was mine. Several of my friends from college ended up in other hedge funds, and theirs weren't as scientific as mine. Most of their portfolio managers had MBAs and many only had a bachelor's degree in economics. Others made a lot of money with just a bachelor's degree in art history or political science. Almost the exact opposite of my background. But they all shared one thing in common: intuition about markets.

Average salary varies between hedge funds. As you probably know, most funds follow the 2/20 rule; The fund earns a 2% "management fee" on its entire AUM, regardless of whether it wins or loses, with an additional 20% bonus on any winnings. Hedge fund managers can earn anywhere from $ 0 to $ 100MM + in a single year. Within a hedge fund, there are smaller managers at each desk (a small group of traders within the fund). My desk portfolio manager earned a base salary of $ 500k with a bonus that went from $ 2 million (in a bad year) to $ 20 million (in our best year). He managed the merchants under him and we earned on average, $ 140, 000 annually in total compensation (when I started there after graduating from college 5 years ago) to $ 220,000 when I left last year. If I had stayed a few more years like some of my friends are doing, I would. '

It depends on your definition of hard. The advisory side is not very difficult when it comes to responsibilities at the junior level. The math is basic, just addition, subtraction, multiplication, division, and some composition formulas. What makes this job difficult is the ability to sit in a cubicle 16 hours a day, 6 to 7 days a week, processing numbers on spreadsheets or spending time making PowerPoint presentations look pretty under severe shortages. of time. This job doesn't require a genius. It requires stamina, an eye for detail, and the ability to adapt to fast-moving situations. Basically, you need

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It depends on your definition of hard. The advisory side is not very difficult when it comes to responsibilities at the junior level. The math is basic, just addition, subtraction, multiplication, division, and some composition formulas. What makes this job difficult is the ability to sit in a cubicle 16 hours a day, 6 to 7 days a week, processing numbers on spreadsheets or spending time making PowerPoint presentations look pretty under severe shortages. of time. This job doesn't require a genius. It requires stamina, an eye for detail, and the ability to adapt to fast-moving situations. Basically, you have to be professional at all times.

As a service provider, you are entirely at your customer's disposal. The time of day or night doesn't really matter if the customer needs to see something tomorrow morning. You roll up your sleeves and just do it. No matter what the client does with the materials you prepare, your job is to make them completely accurate and present in a professional manner. And while this may seem frustrating at times, put yourself in the shoes of a customer who is willing to pay your company $ 5 million for 6 months of work. You'll expect zero errors, crisp analytics, and clean presentations that are easy to follow. Add to that the fact that you will be aware of customer information that most of your client company's employees will not know.

As you move up in investment banking, the definition of your role changes and so do your responsibilities. Communication with the client and interaction with other advisors and stakeholders becomes an increasingly important part of the job and, at the CEO level, you are judged solely on your ability to bring business to the company. Now THAT is hard enough, because no book on earth can teach you the art of relationship management.

None of these are requirements.

Investors will often insist on an independent fund manager so that they don't have to rely on the fund manager to tell them the value of their shares and calculate fees. Funds often prefer to outsource these responsibilities for their own reasons. You are correct that the fund should do these things on its own, partly as a manager's control and partly because it needs the information for its own planning. But they are important enough that people are willing to pay to have them done twice. Also, the fund's internal policies will generally differ from the adm.

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None of these are requirements.

Investors will often insist on an independent fund manager so that they don't have to rely on the fund manager to tell them the value of their shares and calculate fees. Funds often prefer to outsource these responsibilities for their own reasons. You are correct that the fund should do these things on its own, partly as a manager's control and partly because it needs the information for its own planning. But they are important enough that people are willing to pay to have them done twice. Additionally, the fund's internal policies will generally differ from those of the manager because they use the information for different purposes.

Having a CFO is primarily a matter of manager size and title policy. A two-person fund could appoint a CFO, but the title is only meaningful when the fund's operations are complex enough to require a "head" level of administration above the heads of the accounting, finance, planning departments. and reports. The CFO role does not overlap with the others you mention, it is a supervisory position.

A fund may outsource bookkeeping or hire accountants. The accounting records do not overlap much with the administrator, who will generally take information from the custodian and the main brokers; Information from fund accountants is only required for complex or difficult-to-value positions (remember, the manager is hired to be independent). But the manager generates much more accounting information than the manager uses.

On the one hand, the administrator only cares about information about the level of funds. If the manager performs a trade and allocates it to different funds and accounts, only some of which are used by the manager, someone needs to track down the trade level information. In addition, there is all the accounting that the management of a business entails, salaries, rent, etc.

An accountant performs financial functions related to the compilation, accuracy, recording, analysis and presentation of a business, organization or financial operations of the company. In a smaller business, an accountant's role may consist primarily of collecting, inputting, and reporting financial data. Medium to large-sized companies can use an accountant as a financial interpreter and advisor, who can present the company's financial data to people inside and outside the company. Generally, the accountant can also deal with third parties, such as suppliers, clients, and financial ins.

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An accountant performs financial functions related to the compilation, accuracy, recording, analysis and presentation of a business, organization or financial operations of the company. In a smaller business, an accountant's role may consist primarily of collecting, inputting, and reporting financial data. Medium to large-sized companies can use an accountant as a financial interpreter and advisor, who can present the company's financial data to people inside and outside the company. Generally, the accountant can also deal with third parties, such as suppliers, clients, and financial institutions.

An accountant is a professional responsible for maintaining and interpreting financial records. Most accountants are responsible for a wide range of finance-related tasks, whether for individual clients or for larger companies and organizations that employ them.

Although the daily duties of an accountant will vary by position and organization, some of the more common tasks and responsibilities of accountants include:

  • Ensure the accuracy of financial documents, as well as their compliance with relevant laws and regulations.
  • Preparation and maintenance of important financial reports.
  • Prepare tax returns and ensure that taxes are paid correctly and on time.
  • Evaluate financial operations to recommend best practices, identify problems and strategize for solutions, and help organizations run efficiently.
  • Offering guidance on cost reduction, revenue improvement and profit maximization
  • Carrying out forecasting evaluations and risk analysis.

For more information based on accounting, you can check YouTube channel named "Vaishali audit" and its app also on Google Play Store named "Vaishali audit".

I hope I have been helpful

Thanks :)

Well, first, to go to the buy side, you usually need the sell-side experience, which I'll cover at the bottom. I am also going to talk a bit about Venture Capital as it is very similar to PE.

PE, VC, and HF serve the same customer base, but have radically different approaches to generating returns, and they all operate in different parts of the business lifecycle.

Venture Capital invests in startups in the seed (or idea), series A or B (or later) funding rounds, then holds the investment until subsequent funding rounds, an IPO, or a private equity firm wants to buy it. Venture capitalists take advantage of their

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Well, first, to go to the buy side, you usually need the sell-side experience, which I'll cover at the bottom. I am also going to talk a bit about Venture Capital as it is very similar to PE.

PE, VC, and HF serve the same customer base, but have radically different approaches to generating returns, and they all operate in different parts of the business lifecycle.

Venture Capital invests in startups in the seed (or idea), series A or B (or later) funding rounds, then holds the investment until subsequent funding rounds, an IPO, or a private equity firm wants to buy it. Venture capitalists leverage their connections and experience in relevant markets to improve the likelihood of business success by bringing in clients or advising inexperienced managers. The lead venture capitalists (the one with the largest stake) will also help structure future funding rounds and find employees as the company grows. They are an active partner of the company. This area is now open to non-accredited investors as part of Title III of the JOBS Act (with some restrictions).

Private equity firms typically take a stake in an already profitable private company or project and then hold onto it for several years. Often times, businesses develop and owners just want to get paid without going to public markets. Alternatively, some will look to underperforming companies (both public and private) to convert to private companies, improve efficiency, and then go public again or wait for them to come back before going out. Alternatively, a private equity firm could have an equity stake in project financing. The deal I interned on was for a plant that produced hydrogen for industrial purposes and was run by an established company that already had 10-20 such plants and needed additional capital to expand further. Our role would be as a silent partner and receive capital in the new plant, with the eventual option of selling our stake to the firm. The reason this would not be considered VC is because we were working with an established company rather than a startup. We had potential for losses due to the structure of the deal and we had potential for capital gains (also due to the structure of the deal). The reason this would not be considered VC is because we were working with an established company rather than a startup. We had potential for losses due to the structure of the deal and we had potential for capital gains (also due to the structure of the deal). The reason this would not be considered VC is because we were working with an established company rather than a startup. We had potential for losses due to the structure of the deal and we had potential for capital gains (also due to the structure of the deal).

Hedge funds, on the other hand, generally operate in public markets. When they were conceived in the 1950s, they primarily made their namesake hedge mutual funds precisely, either shorting (very rare at the time as it had a huge negative stigma) or investing in countercyclical companies. Since then this idea has evolved substantially and we have market neutral hedge funds (long / short stocks, which should be acyclical rather than counter or procyclical), option selling, distressed debt, commodity funds, HFT, etc. has become the general purpose name used for any fund that operates in the public markets and is not a pension or mutual fund, and if you are a media outlet,

So the main difference is whether they operate in public or private markets. The main similarity is that both deal with foreign money and their investors must be accredited.

Now, I realize this post makes it seem like there is a bold line between the three, there isn't. A private equity or hedge fund can participate in a syndicated debt offering, a private equity firm can bypass the CV line and vice versa. I would say that, in my experience, there is no such thing as a “pure” VC / PE / HF fund.

Typical career paths:

Private equity and venture capital tend to draw their negotiators out of the same areas, which is side-selling investment banking. PE is, after all, who IB regularly sells to (IPOs and some debt offerings excluded). The reason for this is that IB involves not only the structuring of agreements, but also the valuation of the company, which is precisely what the PE does; the main difference is that the PE is buying and the IB is selling (therefore buying versus selling). This is also key for VC.

VC and PE also typically have subject matter experts (SMEs) who will consult or, in the case of larger funds, work full time with the company to provide industry information. To improve investment efficiency, they can hire top management consulting firms.

Often times, HF will hire Stock Sell Investigators (ER, used as a wild card for any type of investment research). All of ER's job is to value public companies and debt, which is the space that HF ​​operates in, so it makes sense. Also, many large funds will purchase ER research for some or all of their investments (which defeats the purpose of paying to use a hedge fund, right?). Lastly, high-net-worth individuals can purchase research for their personal investments, giving the HF an edge if they are looking to expand.

I hope this helps!

I have worked in fund management for five years in an offshore jurisdiction.

the work of the administrators consists of:

  • Navigation calculation
  • subscriptions and redemption or transfer agency function
  • fund accounting and reporting as required by regulation
  • reconciliation of records maintained by the custodian, investment manager and manager, as well as by banks

Personally, my role is very NAV based, but I know other managers who only handle investor underwriting and redemptions, we do the full process and also manage cash, settle transactions with the custodian, post prices at Price sources uh Bloomberg, we circulate fine

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I have worked in fund management for five years in an offshore jurisdiction.

the work of the administrators consists of:

  • Navigation calculation
  • subscriptions and redemption or transfer agency function
  • fund accounting and reporting as required by regulation
  • reconciliation of records maintained by the custodian, investment manager and manager, as well as by banks

Personally, my role is very NAV based, but I know other managers who only handle investor underwriting and redemptions, we do the full process and also manage cash, settle transactions with the custodian, post prices at Price sources, uh Bloomberg, we circulate the financial statements, the contract notes. , investor holding reports, completing some tax information and FATCA statements, we assist with the launch of a fund in our jurisdiction and can provide legal advice if necessary. We ensure that the fund fulfills its mandate and offers documents, as well as the relevant regulations. We flag any suspicious activity and make sure anti-money laundering procedures are followed.

It is a varied role that can be very satisfying if you get to work with the entire process of launching the fund and calculating the net asset value.

There are many opportunities if you know the field you are getting into. Asset management is a pretty broad term.

Now, assuming you are looking for a position where you can manage client money, let me tell you about the harsh reality that newbies don't even get a chance to fill that position.

For newer CAs, roles such as financial controller, internal audit, legal entity controller are available.

There are some organizations that offer management training programs for a very small number of CAs where you would actually be exposing yourself a bit to asset management work. But even then, in the

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There are many opportunities if you know the field you are getting into. Asset management is a pretty broad term.

Now, assuming you are looking for a position where you can manage client money, let me tell you about the harsh reality that newbies don't even get a chance to fill that position.

For newer CAs, roles such as financial controller, internal audit, legal entity controller are available.

There are some organizations that offer management training programs for a very small number of CAs where you would actually be exposing yourself a bit to asset management work. But even then, in the early years, the job would be more of a clerical job.

In the United States, you could technically be an investment banker without any license. However, most people who work for investment banks as bankers are licensed as general securities representatives (for which you must take and pass the "series 7" test).

The license is granted by the Financial Industry Regulatory Authority (FINRA) and mainly covers the regulations that you must know to be a stockbroker. Most of it is unrelated to investment banking, but most investment bankers are licensed, as they can occasionally advise clients to buy or sell securities, and the people who do so s

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In the United States, you could technically be an investment banker without any license. However, most people who work for investment banks as bankers are licensed as general securities representatives (for which you must take and pass the "series 7" test).

The license is granted by the Financial Industry Regulatory Authority (FINRA) and mainly covers the regulations that you must know to be a stockbroker. Most of it is unrelated to investment banking, but most investment bankers are licensed as they can occasionally advise clients to buy or sell securities, and the people who do should be licensed.

Socrates said it best. You don't know what you don't know.

Frankly, I'd be a fool to start your own accounting / auditing business with less than 5 years of experience and maybe 10. I started mine at age 10 and still shudder at the malpractice I did back then.

There is no substitute for experience. In addition, the client will look for experienced accounting professionals.

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