Pragmatic Capitalism

Capital for Living a More Practical Life

The Biggest Myths in Investing, Part 5

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Bonds have maturity value different to the market value. This is true for a lot of assets of course. What does an investment firm quote to a client when asked for the value of the assets in their portfolio under management, the present market value of the assets, or the maturity value, or both.

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Posted by Dinero
Posted on 02/22/2017 5:59 AM
Private answer

“In finance, assets under management (AUM), sometimes called funds under management (FUM), measures the total *market value* of all the financial assets which a financial institution such as a mutual fund, venture capital firm, or brokerage house manages on behalf of its clients and themselves.”

(Seems the only logical definition, doesn’t it?)

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Posted by vlad
Answered on 02/27/2017 12:26 PM
    Private answer

    Most firms mark to market on most assets except for highly illiquid assets. In the case of bonds we should be able to mark to market.

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    Cullen Roche Posted by Cullen Roche
    Answered on 02/28/2017 1:31 AM