Who is a fund manager? Know about their roles, responsibilities in a mutual fund

Over the years, mutual funds have emerged as a promising and profitable investment option. When it comes to making a selection regarding the appropriate mutual fund schemes or certain decisions, there are a lot of perimeters to consider including return expectations, risk tolerance, and investment horizon. This is where a fund manager comes into play.

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In simple terms, fund managers are financial professionals who are responsible for managing the investment on behalf of their investors. They also execute the investors’ buying and selling decisions to optimise the portfolio.

Read further to understand in detail.

About Fund Managers

Fund managers are professionals or investment experts who are responsible for managing mutual funds along with other pension funds, hedge funds, and even portfolio management services on behalf of the investors. Their job is to simply make the necessary investment decisions and complete the fund investments’ future objectives.

Thereafter, it is necessary for investors to thoroughly research and evaluate the investment approval adopted by the fund managers before committing to a mutual fund.

Here are the rules and responsibilities carried out by the fund managers in a mutual fund:

The fund manager looks after the portfolio of securities that the mutual fund holds, carefully selecting a mix of bonds, stocks, or other assets to achieve the investment goals.

They also make necessary decisions based on market trends, economic conditions, and investment strategies that directly impact the funds’ performance and returns for investors.

Carrying out in-depth research and analysis is a key task to be done by the fund manager. They need to study market trends, company financials, and any other market indicators to identify investment opportunities.

Managers also try to balance the risk and returns associated with the relevant investments to ensure that the fund is stable and that the investors’ interests are protected.

On top of it, they also regularly track the performance of the funds, even taking the crucial decision to exit any underperforming securities. The goal is to make better returns in the benchmark.

The fund manager is tasked with ensuring compliance with the regulatory guidelines of the Securities Exchange Board of India. They must formulate policies and regulations for mutual funds in line with the SEBI guidelines.