Asset Management

Funding your future

by Melinda Earsdon

Douglas Eu, chief executive, JF Funds

In the fiercely competitive world of fund management, impeccable communication skills and nerves of steel are your chief assets

Say "fund manager" and most people picture fast cars, huge bonuses and a glamorous lifestyle which, to a certain degree, is true. However, every coin has two sides and what might be less obvious is the colossal stress and long hours which fund managers endure - not to mention the fact that they venture their careers on their decisions on a daily basis.

Despite this, Douglas Eu insists that this career is highly rewarding. As chief executive of JF Funds in Hong Kong, his main job is to run the pooled funds business, primarily consisting of sales, marketing, product development and strategy. A hands-on manager, Mr Eu prides himself on taking an active role in human resources and is very much the public face of one of Asia's largest asset management firms.

"My role is very much managerial, which means I spend most of my time in meetings brainstorming about new products, how we can educate our sales people, our third party sales people and even our clients," he explains. "We are always bringing new instruments to the market, so it is essential that we are all clear about what we are doing."

Hong Kong born, Mr Eu gained a BA in Economics and East Asian Studies from Vassar College, New York and an MBA from the London Business School. After a year as a project consultant with the pension fund department of Esso (UK) Plc, he joined JF Securities in 1987 as a Hong Kong property analyst. Over the next four years, he expanded his area of research to cover the entire Pacific region - including Japan. Just prior to the introduction of the first B shares, he became an investment manager, responsible for Greater China equity, and focused on setting up other China funds for clients. From here, he assumed various asset management roles before taking up his current position in 2002.

"With the exception of my current position, I have basically spent seven years creating my own roles as I moved up the ladder and I assume I will do that again with my next move," Mr Eu smiles. "Recently, I have been heavily involved in the hedge funds arena and see many opportunities here for the future. But, essentially, what I do is run a company and those skills can easily be adapted to suit any major corporation."

Not a business for the faint of heart

A notoriously cut-throat industry, competition for the limited number of fund manager positions available is fierce. An in-depth knowledge of financial instruments is not necessary, nor is a degree in a finance-related subject, but a basic understanding does help. A fund manager must be independent and able to grasp information quickly and understand a wide range of topics, as a large part of the role focuses on analysing companies from all kinds of industries. However, the single most important characteristic is excellent communication skills.

The asset management business is expanding rapidly as more and more people grasp the importance of providing for the future, but that does not necessarily bode well for someone trying to break into the market. A good starting point is to take on a role in equity research, much as Mr Eu did. He says, "You have to look at your career like a game of golf. The ultimate objective and the near-term target are not the same thing. Young people starting out should try to think about how each job they take fits into their career plan."

"You must also be certain of what you want," he continues. "Fund managers are under a huge amount of stress every day. They play with enormous amounts of money and gamble with people's life savings. They make decisions that might be wrong on a daily basis.

"The market is your teacher and she constantly gives you a grade in the form of a share price. Your report card is published in the paper every day in the form of fund prices. This means your every mistake is available for public scrutiny. While good days are incredibly rewarding, bad days can be hell. This is not a business for the faint of heart."

Routes to heading up an asset management firm include starting as an equity analyst on a monthly salary of approximately HK$10,000, and, after around two years, moving to the position of fund manager, earning HK$10,000 to HK$100,000 a month. Otherwise, potential high-flyers can start as investment managers or in marketing, again on HK$10,000 to HK$100,000 a month. However, Mr Eu notes that it takes roughly 20 years' experience to become chief executive.

In addition, opportunities are rife in China. Mr Eu explains, "What we are seeing is a huge number of joint ventures between foreign and domestic companies, which means the demand for overseas-qualified executives is high. And when you do the basic maths of tax plus property costs offset against income, salaries pretty much even out wherever you are in the world."

Taken from Career Times 14 November 2003
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