![]() After considering your financial goals and risk tolerance, the money manager assembles a portfolio of stocks, bonds, and certificates of deposit (CDs). You give $100,000 to a professional money manager who creates an SMA for you. You give the money manager the discretion to invest in stocks, bonds, mutual funds, ETFs, or other securities on your behalf. In an SMA, you hire a professional money manager to invest your funds according to your objectives and risk tolerance. How a Separately Managed Account (SMA) Works ![]() These investors usually have at least six figures to invest and seek to collaborate with a professional money manager to focus on a single, personalized investing goal. Institutional or affluent retail investors typically use SMA. SMAs differ from other investments, such as mutual funds and exchange-traded funds (ETFs), in which your funds are held together in one pool with other investors' funds. You may choose between hundreds of stocks, bonds, and other securities to create a unique portfolio tailored to your financial objectives. You can customize it according to specific investment goals and preferences. The individual investor retains complete control over the assets and can direct the money manager to modify their portfolio as needed. What Is a Separately Managed Account (SMA)?Ī Separately Managed Account (SMA) is an individual portfolio of investments administered by a professional money manager on behalf of a client.
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