investment manager
Investment Manager: the professional you pay to decide what to buy, hold or sell with your money, so you don't have to watch the market yourself.
In plain English
Think of a jollof rice pot that needs constant attention. Someone has to check the heat, taste the stew, know when to add water and when to leave it alone. Most of us don't have the time, the taste buds, or honestly the patience to do this well with our money, so we hire someone who does it for a living.
That person is an investment manager. You hand them a sum of money, tell them roughly what you want it to become, and they decide where it goes. Nigerian government bonds, shares on the Nigerian Exchange, treasury bills, foreign stocks if you are investing through a licensed fund with that mandate. They study the market so you don't have to check share prices every morning before you go to work.
In Nigeria, this could be someone managing a mutual fund at a firm like Stanbic IBTC Asset Management or ARM, pooling money from thousands of ordinary savers and investing it as one large, carefully thought out portfolio. In the United Kingdom, it might be the person behind a pension fund your employer signed you up to, calmly deciding how your retirement contributions grow over thirty years.
A Nigerian in Lagos and one in London might use the same fund manager without ever meeting, because good management scales. The person abroad sending money home for a sibling to invest is really asking that sibling to become an accidental investment manager, and that is exactly why many people would rather pay a professional and sleep well instead.
They don't work for free. They charge a management fee, usually a small percentage of what they manage each year, whether the market goes up or sideways. The trade you are making is simple: you give up some of the upside in exchange for expertise, discipline and time you get back for yourself.
You invest ₦1,000,000 in a mutual fund charging a 1.5% annual management fee. That is ₦15,000 a year taken calmly for the manager's work, regardless of whether the fund grows or shrinks that year.
Questions people ask
Is an investment manager the same as a stockbroker?
No. A broker executes trades you ask for. An investment manager decides what trades to make on your behalf, often without checking with you first, depending on the agreement you signed.
How do I know if my investment manager is doing a good job?
Compare their returns after fees against a relevant benchmark, like a stock market index or an average of similar funds, over several years, more than a good month or a bad one.
Do I need a lot of money before an investment manager will work with me?
Not necessarily. Mutual funds let you start with a modest sum, sometimes as low as ₦5,000, because your money is pooled with everyone else's and managed together.
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