A Day in the Life of a Portfolio Manager
January 31, 2025
What Does a Portfolio Manager Do?
The role of a portfolio manager is central to every business or organisation that is involved in managing money. The portfolio manager (or the team of portfolio managers) has the ultimate responsibility of managing various types of funds, including what goes in and out of the portfolio (i.e. security/instrument selection) and its overall shape in terms of position size, asset allocation and risk management. The job also involves regular communication with various parties, both internal and external, such as research analysts (who in some cases are direct reports to portfolio managers), compliance and distribution teams, and clients. Therefore, a deep knowledge about the markets and investments is essential. Additionally, the role requires excellent presentation and communication skills. At times, especially when the portfolio is not performing as expected, the role can be stressful, but on the other hand, it could be quite fulfilling when delivering positive outcomes for clients.
Key Learning Points
- Portfolio managers are responsible for the construction and the ongoing monitoring of investment portfolios
- The role is typically appealing to those with strong interest in financial markets and investments, and would be a natural career progression path for research analysts
- Portfolio managers can work for different types of firms and organisations such as asset management companies or a hedge funds
- The work-life balance offered by this role is expected to be more balanced compared to other areas of the finance industry such as investment banking or private equity
A Day in the Life
No one day is like another in the role of a portfolio manager. There are a number of activities that needs to be followed, and the schedule of a portfolio manager is expected to be very busy. Below we explore some of the possible activities such as meetings or reviews that a portfolio manager may have during the day.
6 AM – 7 AM
The vast majority of portfolio managers have an early start of the day (unless covering markets and time zones outside their location that would require different working hours). Following a morning routine, they would typically have a quick scan through the news just to make sure that there are no major events that may require and immediate action regarding their portfolio.
7 AM – 9 AM
Arriving in the office and preparing for the markets to open (for example, the London Stock Exchange opens at 8am local time, while the New York Stock Exchange opens at 9:30am local time). During this time, a portfolio manager would have a closer look at the news about markets, asset classes and the securities they have in their portfolio (for example, a listed equities manager would look at the corporate news and announcements relating to their stocks). They may also prepare for any trades they are making in the portfolio, passing on specific instructions to the dealing team that will execute those trades. These trades may be because of new clients investing or because of redemptions from clients that will need to be processed.
9 AM – 10 AM
Time to read the research produced by the analysts. This will include new investment ideas along with recommendations to increase or trim position sizes or to sell an entire position. This is typically done in line with the investment philosophy and process that the manager employs. The manager also reviews different statistics around the portfolio such as risk, valuations, liquidity etc.
10 AM – 11AM
It is time for the first meeting for the day – the team, comprising of the portfolio manager(s) and the research analysts, gets together to discuss their findings and propose portfolio adjustments. It is expected that researchers will do most of the talk and give updates on things such as new ideas they might have come across, interactions with companies (be it attendance at investor days or calls with investor relations teams), macro developments or any other portfolio-related matters. Portfolio managers will likely ask questions and challenge some of the findings.
11AM – 12AM
Before lunch, the manager may use the time to read the latest report they received from the risk and compliance teams. This might include issues related individual positions and/or any internal or regulatory limits that the portfolio might be in danger of breaching. For example, an equity manager has an internal limit of a maximum 15% ownership in a company and because of positive company news and share price moves, their shareholding is now approaching that level – this must be considered and reflected into the portfolio.
12AM – 2PM
There could be a couple of scenarios for how portfolio managers are spending their time at lunch.
- There is a specific market event that requires the manager to be at their desk – in this case they would have a sandwich while continuing to monitor their portfolio constituents
- The firm has organised a lunch for their clients and the manager is giving an update about their portfolio in terms of latest developments, positioning, and performance
- A holding company is giving an update for investors where they will give a brief overview of the latest developments in the company, any changes to its management, strategy, or structure, along with some guidelines in terms of anticipated results
2 PM – 3PM
This is typically the time that managers use to review any important economic releases such as inflation, industrial production, or jobs creation numbers, as well as their impact on their portfolio. This is also a chance to assess the current market environment and help build an outlook for different asset classes and markets.
3 PM – 5PM
In the afternoon, a management meeting takes place. It involves portfolio managers and senior management sitting together and discussing the recent and long-term performance of the portfolios they manage, as well as risk levels and any other matters that the mandate might be focused on (e.g. climate–related metrics). This is where portfolio managers get challenged.
In another scenario, the manager and a few analysts are making a visit to a holding company for a review. Their due diligence may include meeting with various people at the organisation such as finance and operations executives, or heads of different divisions.
5 PM – 6PM
At this point local markets are now closed, and follow-on adjustments could be made as long as there is liquidity in the market. Trades that were made during the day are checked if passed through compliance, settlement issues are solved, and market conformity checks are completed.
Hours and Lifestyle
Lifestyle and work week hours would be more balanced compared to other areas of the finance industry such as investment banking. Portfolio managers are expected to work between 45 and 60 hours a week (usually hedge funds would require more hours) and weekends will be free unless there is an extraordinary market event that requires urgent actions or some sort of technical failure. However, most managers will use some of their personal time to read about markets and investing.
Portfolio Manager Salary (and Bonus)
The base pay of a portfolio manager would range depending on many factors such as their seniority at the firm, their level of experience and track record, and the size of the assets under management. In addition, the industry the portfolio manager is in can be an important factor. Below are some examples:
Taking this into account, the base salary of an experienced portfolio manager (with 10+ years of experience in investing) may range between $250k and $500k. However, typically it is the performance-related bonus that is the more attractive component of a managers’ pay. It can be influenced many factors such as what is the portfolio’s watermark (i.e. the minimum performance level that a manager needs to achieve to receive a performance-related bonus), asset flows over the past year and the prevailing market environment. In good years, the bonus that portfolio managers receive could be more than a 100% of their base salary. As a rough guide, hedge fund roles are expected to be awarded with higher pay due to the higher fees they charge and the complexity of their investments, while roles in asset and wealth management may pay a bit lower but still offer quite attractive remuneration packages.
Conclusion
So, is the role of a portfolio manager right for you? If you have a natural interest and passion about markets and investing, the obvious answer is yes. However, there are also other things to consider such as the time it takes to learn and master investing, and the professional qualifications that are often required. It is also important to factor in things twill not always go smoothly and stress level would be elevated at times. If this is something that you are comfortable with, then this career path might be a good fit. We offer a whole range of portfolio management expert interview videos that can be very helpful if you are preparing for an interview or want to see what type of questions are typically asked. that can be very helpful if you are preparing for an interview or want to see what type of questions are typically asked.
Additional Resources
Portfolio Management Certification
Portfolio Management Interview Questions