Understanding Investment Fund Management

This pathway provides a comprehensive online self-paced overview of the business of operating retail UK-based open ended investment funds (UK UCITS and NURS), explaining what the key activities are, why they matter and how they are regulated.

Designed to give learners an understanding of the business in the round, both as an introduction and as a reference source, the e-learning has been developed by Cadogan Financial Ltd, which has successfully delivered the two-day classroom course Understanding the Business of Investment Fund Management in co-operation with the Investment Association for twenty years.

It is also a ‘jargon buster’, describing in plain English what the many investment fund management acronyms (UK UCITS, NURS, OEICs, ICVCs, etc) and terms (such as single and dual pricing, dilution levy or adjustment) mean, and their significance, such as the differences between variable capital (open ended) funds and fixed capital (closed ended) funds.

Key Learning Objectives

• The different legal and operational investment fund structures and the implications of these for the businesses that operate and service funds
• The legislative and regulatory framework governing UK-based investment funds and its key elements
• The ways investment funds are sold and marketed and the impact of regulation on these
• Key elements of investment fund disclosure and communication and how this is regulated
• The asset classes in which investment funds invest, investment objectives, how assets are managed to meet objectives, the investment and borrowing limits that are applicable, rates of return and the importance of performance
• How funds are valued and priced and how regulation affects these activities
• Types of charges and costs paid by funds or fund investors and the impact of regulatory policy on this
• How dealing in funds is undertaken, share or unit types and classes and the activities involved in servicing fund investors
• Key elements in operating a retail fund management business and factors in success

Module 1: FUNDguide - How to use the course

• the structure of the course
• navigating the course
• the order of study of the modules
• external resources
• knowledge checks
• the assessment

Modules 2-5: the basic building blocks

• Module 2: FUNDintro - overview
• Module 3: FUNDamentals - key concepts
• Module 4: FUNDctionalities - roles
• Module 5: FUNDreg - regulation

Module 6: FUNDraising - making the sale

• legal constraints on promoting funds and or advising on them
• direct and indirect distribution of funds
• the main channels through which funds are distributed
• types of advice on funds, how advice is paid for and who pays for it
• methods of promoting brand and product awareness

Module 7: FUNDcomms - communications

• responsibility for provision of information
• regulatory principles applying to communications and target markets
• requirements for key investor information documents and the challenges of communicating investment risk effectively and accessibly
• the use of past performance, quartiles and benchmarks
• other mandatory elements of disclosure including reports and proposed changes to funds

Module 8: FUNDinvest - investments

• investment objectives, different asset classes and their characteristics and how the asset classes are used to meet the objectives
• regulation governing permitted investments for UK UCITS and NURS and reasons for limitations on risk and liquidity
• rates of return and real rates of return
• active and passive (indexed) management and the development of Exchange Traded Funds ('ETFs')

Module 9: FUNDworth - valuation

• what net asset value is and who is responsible for calculating it
• how net asset value per unit is calculated and the impact of incorrect valuation
• the different valuation bases used for dual and single priced funds
• the use of a dilution levy or dilution adjustment
• Some examples of valuation problems are also given

Module10: FUNDcost - charges and costs

• why the levels of charges and costs paid by investors matter
• the impact of regulation on charges and costs that may be payable by funds or fund investors
• the types of charges and costs that investors may pay while entering or exiting a fund or while invested in a fund
• the ability to levy different charges on different unit classes
• disclosure of charges and costs
• pressures on charges from regulatory policy and competition from Exchange Traded Funds

Module 11: FUNDops - administration

• the regulatory framework governing responsibility for fund administration
• reasons for strong regulatory provisions for redemption rights and suspension of redemption
• the difference between the fund management company acting as principal (‘operating a box') and as agent in dealing in units
• regulatory controls on acting as principal
• methods of proof of ownership of units
• maintenance of a unit holder register
• messaging systems underlying unit transactions
• payment of income and the difference between income and accumulation units

Module 12: FUNDgrow - winning strategies

• why new funds are launched and the impact of regulation on this
• the importance of tax efficiency of funds and the role of 'wrappers' such as personal pensions
• the allocation of funds to sectors and the importance of good performance
• the pros and cons of operating open and closed ended funds
• the challenges of forecasting and budgeting
• the potential for continuing market growth

Module 13: FUND assessment

• This module is an assessment which contains a series of multiple choice questions covering modules three to eleven to test your understanding and knowledge. Each assessment is individually generated from a data bank of questions so should you take it again, the questions will not be the same.

IA Member £295.00 +VAT
Non-Member £395.00 +VAT

Discounts are available for those booking 10 or more learners – please contact the IA at Training@theia.org

The licence for the e-learning is for one year.

CPD 9.46 hours including a randomly generated multiple choice assessment.