Everything you need to know about investment managers
Everything you need to know about investment managers
Investing in film can be a rollercoaster. It’s a glamorous industry with a high risk to reward factor that can see unwary investors come unstuck. Placing your money with an investment manager is one way to mitigate the risk and maximise the tax breaks available through EIS schemes.
An investment manager can help you choose the right movie investment with guaranteed distribution.
But is an investment manager the right choice for everyone?
If you want to make the most of your investments, an investment manager can develop a strategy in line with the level of risk you’re willing to take
What’s the difference between an investment manager and a fund manager?
According to Investopedia an investment manager is “a person or organization that makes investments on behalf of clients under the investment objectives and parameters the client has defined.”
A fund manager, on the other hand, is responsible for implementing a fund’s existing investment strategy and managing its investments.
Investment managers and fund managers will often work together when it comes to optimising your investment portfolio.
If you want to get into investing, and film financing in particular, in a way that gives you granular control over investment outcomes then an investment manager can be a savvy choice.
What exactly do investment managers do?
Think of an investment manager as a critical friend.
They’ll scrutinise potential investments on your behalf and find specialist film investment opportunities through companies like Films4U.
As a professional, they’re highly qualified to make the right decisions and maximise the benefits for your portfolio with a rock-solid investment strategy tailored for you.
Whether your investment manager works alone or as part of a multi-disciplinary global office, they’re working towards the same objective – to grow your investments in line with your future financial planning goals.
How that happens more often than not depends on the level of risk you’re willing to take.
If you’re interested in becoming a film investor, but you’re looking to mitigate your exposure, an investment manager with a fund oriented on the creative industries will help you make the most of generous EIS or SEIS tax breaks.
Yes, you’ll pay a monthly fee for their services. But in return you should expect to boost the power of your portfolio with well-placed investments that attain the holy grail of successful diversification.
Is an investment manager a financial institution?
Investment managers are part of a larger financial institution like a bank or trust. That means they’re regulated by the same codes of conduct as laid down by the FCA.
So what does that mean for you as an investor? You can be confident that your manager is working in a fair and transparent manner and that your investments will perform as expected.
Pros to having an investment manager
If you’re a first time investor who would benefit from some hand-holding, an experienced investment manager is a useful ally.
Even experienced film financiers benefit from a steer towards lucrative investment opportunities.
- Professional guidance and analysis in a high-risk environment can prove invaluable
- They can help you identify, track and mitigate the risks of investing in film
- You’ll enjoy the peace of mind of having your portfolio looked after by a professional who knows exactly what they’re doing
- You’ll have a better chance of outperforming the market
- They’ll know how to protect your investments through the downtimes by diversifying your portfolio and focusing only on the risks you’re willing to take
Remember, your investment manager has skin in the game when it comes to their reputation. This is why you should always expect excellent service and peace of mind.
Cons to having an investment manager
But using an investment manager isn’t all plain sailing. And peace of mind doesn’t come cheap. Fees can run between 1% to 1.5% of your portfolio and those fees keep coming regardless of how well your investments perform.
So should you consider going it alone?
- Even though an investment manager works for you, you’ll have a far higher degree of control over your investments if you stay in control of the assets you select
- Film financing isn’t for everyone. If your investment manager lacks specialised knowledge of EIS or SEIS investments you may find you’re exposed to high-risk situations with no hope of recovering your cash
- Some investment managers can over-diversify your investments and you’ll end up just as exposed to risk as if you made a few investments and managed them yourself
When it comes to film investment opportunities we make it easy to get started without the need for an investment manager. It all depends on how confident you feel in going it alone in a high-risk industry.
How to choose an investment manager
If you’re a fledgling film financier looking for an investment manager to hook you up with that surefire movie investment, do your due diligence and find someone who is experienced in handling specialist film funds.
Film financing is generally done through a sophisticated patchwork of banks, ultra-high net worth Angel investors, hedge funds and other funding bodies.
Choosing the right investment manager will put you in touch with EIS opportunities that can mitigate your risk and provide some healthy incentives in the form of generous tax breaks.
But how do you choose the right manager for your portfolio?
- Choose an investment manager who’ll help you navigate the movie investment market and the associated risks
- Check your manager’s reputation in the market. Are they trustworthy? Do they have access to the right investment opportunities?
- Your manager should communicate in an open and transparent way
- Any advice should be impartial and independent, driven by your investment objectives alone
- They should be able to keep a cool head when everyone else seems to be losing theirs
Conventional wisdom says you should always use an investment manager. Film investment opportunities are notoriously risky.
But if you want to take the plunge into investing, weigh your options carefully before using an investment manager.
At Films4U we have the experience and know-how to put you in touch with some exciting EIS investment opportunities. In fact, we can proudly say that we haven’t lost money on a movie yet.
As an international film production and distribution company, we guarantee distribution of every project we’re involved with and our past performance speaks for itself.