An external asset manager (EAM) is a wealth manager which works “outside” of a bank. In other words, a stand-alone company which is “independent” of banks.
This term is often used synonymously with the term “independent asset manager” although not all external asset managers are completely independent in the stricter sense of the word.
Services offered are numerous and vary between service provider, depending on their level of specialization. Tax consultation, cash management, trading, estate planning and inheritance management are among the services offered by EAMs.
Some external wealth managers focus on specific areas or investments. Examples of specialized areas of practice include: Real estate, commodities, dividends, derivatives or structured products, fixed-term deposits, specific categories of stocks, private equity and hedge funds.
External wealth managers may also focus on specific types of clients. Generally, a difference is made between services provided to private clients and those provided to institutional clients, but wealth managers may service both types of clients. Other possible focus areas include clients in specific sectors, a specific type of client – small and medium-sized businesses or startups, for example – or clients from a specific country or region.
Client accounts managed by external asset managers are maintained at one or more custodian banks.