In­vest­ment Man­age­ment

In­vest­ment man­age­ment pro­vides a va­ri­ety of tools for wealthy in­vestors

Economy of Belarus - - BANKS AND FINANCE -

To­day in­vestors have prac­ti­cally un­lim­ited money-mak­ing op­por­tu­ni­ties and in­vest­ment tools at their dis­posal. In­vest­ing in eq­ui­ties, bonds, pre­cious met­als, for­eign cur­ren­cies, com­modi­ties – all these op­tions can gen­er­ate in­come. How­ever, to be able to trade for­eign stocks, res­i­dents of Be­larus will have to go through sev­eral pro­ce­dures. Banks of­fer in­vest­ment man­age­ment ser­vice that makes this process eas­ier.

Thresh­old of $10,000

In Be­larus, in­vest­ment man­age­ment ser­vices are pro­vided by large banks such as Alfa-bank, Bank BELVEB, Be­la­gro­prom­bank, Be­larus­bank, Bel­gazprom­bank, Bps-sber­bank, and Pri­or­bank. These ser­vices are avail­able to in­di­vid­u­als, le­gal en­ti­ties and self-em­ployed busi­ness­men, both res­i­dents and non-res­i­dents of the Repub­lic of Be­larus.

In­vest­ment man­age­ment ser­vices are de­signed to help a client make smart in­vest­ment de­ci­sions on the stock markets in Be­larus and abroad: stocks of cor­po­rate is­suers, mu­tual funds, eurobonds, gov­ern­ment se­cu­ri­ties and cor­po­rate bonds, de­riv­a­tives (fu­tures con­tracts, op­tions), de­posits and so on.

A cus­tomer en­trusts a bank with man­ag­ing his money, and the bank in­vests it in var­i­ous fi­nan­cial in­stru­ments. How does this work in prac­tice?

“Bank­ing in­vest­ment man­age­ment pro­fes­sion­als give con­sul­ta­tions on these ser­vices, de­velop tai­lored strate­gies to meet the re­quire­ments of ev­ery client, and draft an in­vest­ment man­age­ment agree­ment,” Be­la­gro­prom­bank said.

The next step is the con­struc­tion of an in­vest­ment port­fo­lio that can in­clude from 4 to 15 dif­fer­ent in­stru­ments. At the dis­cre­tion of the client, the in­vest­ment port­fo­lio can be ad­justed de­pend­ing on the mar­ket sit­u­a­tion.

In­vest­ment man­age­ment means in­vest­ing for the long term, and it re­quires pa­tience. The min­i­mum in­vest­ment pe­riod is one year, while a term of three years and more is gen­er­ally ad­vised.

The money that cus­tomers give to the bank is clearly not the last cent in their pocket. In­vest­ment man­age­ment ser­vices are avail­able for sums start­ing from $10,000. But on av­er­age, ac­cord­ing to the banks, the amount ranges from $30,000 to $60,000. Some­times it reaches a mil­lion.

The bank charges a fixed amount at an an­nual rate of 1-2% of the amount in­vested. If the re­turns on the in­vest­ment are good, the man­ager can ex­pect a per­cent­age on the prof­its. This mo­ti­vates the man­ager to find the best in­vest­ment so­lu­tions for his client.

The­o­ret­i­cally speak­ing, in­vestors may trade for­eign stocks on their own, with­out re­sort­ing to the ser­vices of a bank. How­ever, they will need to get per­mis­sion from the Na­tional Bank to pur­chase stocks, open a bank ac­count for safe­keep­ing in for­eign de­pos­i­to­ries, find a bro­ker, mon­i­tor the sit­u­a­tion on the mar­ket and so on. This will re­quire a great amount of time and money. In­vest­ment man­age­ment ser­vices are de­signed to help in­vestors solve this prob­lem.

“First, it is safer to work through banks than by your­self. Sec­ond, the trans­ac­tions are car­ried out from the gen­eral ac­count of the in­vest­ment man­ager, and bro­kers of­ten charge the in­vestor only a min­i­mum com­mis­sion,” Alfa-bank said.

In ad­di­tion, the bank acts as a tax agent for in­di­vid­u­als. It is re­spon­si­ble for cal­cu­lat­ing and pay­ing all taxes on in­come from in­vest­ments in for­eign stocks, which is quite con­ve­nient for cus­tomers.

Cau­tious In­vest­ment

It is com­monly be­lieved that the Be­laru­sians are con­ser­va­tive and cau­tious peo­ple. This re­flects in the in­vest­ment strate­gies they choose. Most banks of­fer three types of strate­gies: mod­er­ate, con­ser­va­tive and ag­gres­sive.

“The mod­er­ate in­vest­ment strat­egy is cho­sen most of­ten.

Newspapers in English

Newspapers from Belarus

© PressReader. All rights reserved.