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Chapter 7: Market Participants > 7.3 Institutional Fund Managers

7.3 INSTITUTIONAL FUND MANAGERS

Institutional fund managers compete to win investment mandates from institutional investors. An investment mandate lists the types of investment (e.g. the geographical and industry sectors as well as the types of financial instruments) that the investor wishes the fund manager to invest in, sets performance targets for income and/or capital growth that the investor expects the fund manager to achieve, and describes how the fund manager will be remunerated. Within the guidelines of the mandate, the actual investment decisions are left to the fund manager.

A simplified example of an investment mandate might be as follows:

1. The Ethical Investment Pension Fund appoints XYZ Fund Managers to act on its behalf in investing in equities listed on exchanges in the United States of America and Canada.


  

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