Why Companies Need Professional Asset Portfolio Management
Asset management is essential if a company is to maximize the return on investment (ROI) to its shareholders and stakeholders. Despite its importance, however, many numerous companies and entrepreneurs neglect it and fail to provide the necessary attention to the procedures required for an efficient asset management strategy. This can lead to their investments underperforming and they may find themselves exposed and vulnerable to significant risks, due to financial fluctuations and the constantly changing market environment.
There are numerous examples of promising assets that have not reached their potential ultimate maximum return value due to the implementation of mistaken strategies. Similarly, there are examples of entrepreneurs and individuals failing to cooperate with professional investment and finance-related experts, leading to a catastrophic devaluation of their assets and even, in some instances, to bankruptcy or liquidation. Such risks can be greatly reduced through proper consultation and using professional services related to the best exploitation of the company's assets.
Asset management takes a range of investments, allocated into various financial types and categories in order to spread, control and mitigate risk against potential losses. The aim, therefore, is to diversify the investments so as to minimize the exposure of assets to an actual risk, as well as, protect the volatility of the asset portfolio.
Diversification is a risk management technique that focuses on the allocation of investments to a variety of areas and instruments (e.g. immovable property, government bonds, shares, and trust funds), with the aim of maximizing ROI by implementing mitigation parameters of risk and differentiating the performance of assets in order to protect them from a specific event or action. Diversification is very important because it can protect and enhance asset portfolio performance through risk weighting. It is important to note that each investment type reacts differently to economic/financial fluctuations and specific market events.
As an International firm, with a physical presence in more than eight countries, providing legal, corporate, fiduciary and investment consultancy services in more than 21 jurisdictions (including London, New York, Hong Kong, Beijing, Dubai, the Bahamas, Barbados, Belize, BVI, Cayman, Cyprus, Seychelles, Singapore, St Vincent & the Grenadines), we propose that entrepreneurs and individuals should adopt a broader approach to their asset portfolio management, in order to secure applicability on a global level. Multi-jurisdictional corporate transactions, wealth management, portfolio management, trusts, private equity funds, acquisitions, restructuring, real estate investments and citizenship investments are just some of the investment-related services for which demand has been increasing over the last few years.
We suggest that, in order to efficiently take advantage of extensive opportunities in the global market, it is essential to appoint an International Law and Corporate Services firm as a partner. This guarantees the correct due diligence and risk analysis while, from a legal and business perspective, such a firm will undertake risk management analysis and identify systematic risks in order to safeguard the investor's position.
It is crucial that the investors and their legal and investment service providers constantly monitor international politics and relationships between nations in order to safeguard themselves against possible domino effects caused by jurisdictional issues and/or events. Our expertise in the international financial investment arena has shown us that the present era is characterized by traditional investment via the acquisition of immovable property which is seen as the most trusted, stable and profitable avenue. However, investments in physical commodities (i.e. gold), private equity funds, trusts and joint ventures are also considered to be very attractive nowadays, since they provide investors with an opportunity to invest through pooled funds in high-value projects that promise a high ROI.
The "pool of funds" mechanism indirectly ensures that the performance of the project will have a lower risk, if many powerful and reputable partners are involved. Moreover, we also recommend various citizenship plans to investors as an additional and very valuable intangible asset in their portfolio.
The acquisition of additional citizenship at once offers an immediate return with respect to investment opportunities, instant mobility for investors and their family, visa-free travel to many countries (depending on the chosen jurisdiction), financial freedom, security and stability. Citizenship by investment can be considered a long-term and never-ending investment since it can be transferred to the next generation.
This article was first published by GOLD Magazine May 2017
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.