Expert Chaslau Koniukh
  • Companies
  • Global investment
  • Investors
  • Terminology
  • Economy
  • Stock Market
  • World exchanges
  • Tech and Marketing
trust management in the securities market
Market terminology

Trust management in the securities market: types and advantages

19.11.2021
2 min read

What is trust management on the securities market

Trust management in the securities market is an important point between an investor and a broker. It represents the transfer of assets to the manager, but he does not get the rights to this property. Now professionals, who have experience in the market and mechanisms for carrying out operations, start working with them, which should bring income.
The assets that are transferred to the trust management are diverse. These include real estate, tangible and intangible assets, money, and securities. At the legislative level, the procedure of trust management is regulated by the relevant article of the Civil Code of the Russian Federation.
On the stock market, only those companies can take on these responsibilities, which have a special license that allows carrying out various operations with securities. In addition, the staff of such management companies must pass certification, which confirms the right to engage in this type of activity. Under these conditions, it can be considered that the management process takes place officially and in compliance with the law.There are three types of trust management: collective, individual and advisory. The first type includes mutual funds. In addition to these, ETFs are less frequently included here. The collective type implies that investors are united into one group, and the manager deals with their assets as a single pool. In this case, each of the shareholders receives his part of the income. The advantage of this type is a rather low entry threshold to a mutual fund, besides, even with a small amount of investment you can receive professional support.
In case of individual management, personal interaction is carried out. For this purpose, a special agreement is concluded and an investment declaration is drawn up, which guarantees the client protection of his assets from unlawful actions on the part of the manager. Despite the many advantages of individual management, it also has disadvantages, such as a high entry threshold of about 6 million rubles.
Advisory management is not a full-fledged trust management. In this case, a special company and its employees provide only consulting services, and the investor carries out all transactions personally. Such cooperation between the client and the broker is specified in the contract, as well as the amount of the specialist’s remuneration. Advisory services are available even to small investors, the entry threshold is minimal. However, the sole owner of the assets is responsible for the result of the transaction. Therefore, this option is best used if the investor has experience at the exchange, and understands the basic mechanisms. Then he can get a consultation from the management company, and already on the basis of this information take certain actions. The disadvantage of this option is the risk of a conflict of interest, for example when interacting with a brokerage company.

Tags: Market terminology
0
Previous Post Britain and Turkey sign free trade area agreement Next Post Analysts predict an increase in palladium prices

You Might Also Like

expiration of contracts
Market terminology
What is the expiration of contracts on the futures market
28.01.2022
profit capitalization
Market terminology
Profit capitalization: features and functions
25.09.2020
profit factor
Market terminology
Profit factor as a tool for calculating the effectiveness of transactions
01.08.2021
free float
Market terminology
What is the Free Float coefficient
23.05.2021
Notion of deflation
Market terminology
The concept of deflation: causes and consequences
15.10.2020
Short Squeeze
Market terminology
What is Short Squeeze in the market, and how to anticipate it
17.02.2022

Recent Posts

  • 1The concept of financial management-1
    The concept of financial management in terms of the investment horizon
    18.05.2022
  • 2The state of the U.S. economy
    Moody’s Analytics experts have assessed the state of the U.S. economy
    17.05.2022
  • 3Ford invests
    American concern Ford invests in plant construction
    16.05.2022
  • 4Dunamu
    Cryptocurrency exchange operator Dunamu attracted $85 million in investments
    15.05.2022
  • 5artificial intelligence technology in banking
    Artificial intelligence: applications for banking
    14.05.2022

Popular Posts

  • Field of activity of the American Monsanto Company Corporation
  • Skolkovo analysts: the Russian energy market is suffering losses
  • Businessman Chuck Feeney: the man who gave the world Duty Free
  • Why the Federal Reserve System (FRS) refused to raise interest rates

Social media

Editor's Picks

Chaslau Koniukh
Analytics

American bankers from JPMorgan and Goldman Sachs advise to invest in gold: review by Chaslau Koniukh.

Press Secretary
17.08.2020
Expert Chaslau Koniukh
Analytics

Chaslau Koniukh on the analysts’ opinion on the key stake size change soon

Press Secretary
18.06.2020
expert Chaslau Koniukh
Analytics

Chaslau Koniukh: Internet trade market in Russia may reach 2.78 trillion rubles.

Press Secretary
30.05.2020
Will the U.S. oil shale industry be able to quickly recover from the crisis: A Review by Chaslau Koniukh
Analytics

Will the U.S. oil shale industry be able to quickly recover from the crisis: A Review by Chaslau Koniukh

Press Secretary
16.05.2020

Latest Posts

The concept of financial management-1
The concept of financial management in terms of the investment horizon
18.05.2022
The state of the U.S. economy
Moody’s Analytics experts have assessed the state of the U.S. economy
17.05.2022
Ford invests
American concern Ford invests in plant construction
16.05.2022

Chaslau Koniukh

Expert Chaslau Koniukh

Chaslau Koniukh – an expert in marketing and project management, IT consulting, international investments, investor, financial analyst. A commodity trader, private consultant, entrepreneur, lecturer, author of several articles on the stock market.

Popular Posts

  • Field of activity of the American Monsanto Company Corporation
  • Skolkovo analysts: the Russian energy market is suffering losses
  • Businessman Chuck Feeney: the man who gave the world Duty Free
  • Why the Federal Reserve System (FRS) refused to raise interest rates
  • The success story of the company with the most expensive shares – Berkshire Hathaway Inc
Expert Chaslau Koniukh
  • Facebook
  • Twitter
  • Instagram
  • Biography

Chaslau Koniukh – an expert in marketing and project management, international investments, financial analyst.

Social media

Menu

  • Biography
  • Companies and corporations
  • Global investment
  • Investors and Entrepreneurs
  • Economy
  • Market terminology
  • Stock Market
  • World exchanges
  • Tech and Marketing
  • Analytics