Industry-Specific Interview Questions + Definitions- Asset Management

Today’s article will provide you with technical asset management interview questions.

Asset Management Technical Interview Questions:

  1. What is Asset Management?
  2. What is the difference between Active and Passive Management?
  3. What is value investing and how is it different from growth?
  4. What is the formula for free cash flow?
  5. Describe 3 important ratios used in value investing including their formula
  6. What sort of information would you expect to see on a balance sheet?
  7. Explain one important way in which a balance sheet is different from both an income statement and a cash flow statement?
  8. What is the capital asset pricing model?
  9. What is leverage?
  10. Do you know any leverage ratios? Which ones?
  11. Please describe one or more studies that validate the virtues of value investing?
  12. Tell me about a stock that might be undervalued in S&P 500 and why?

Asset Management Definitions:

  • Asset Classes: broad groups of different types investments e.g. equities, bonds and cash
  • Asset Management: managing large sums of money on behalf of clients to get a return on investment (long term) by investing in the financial markets
  • Active Management: investment managers aiming to beat the market through research, analysis and their own intuition
  • Passive Management: A style of investment management that replicates performance from a benchmark.
  • ESG: environmental, social and governance. ESG criteria are a set of standards for company’s to abide by, socially conscious investors take this criterion into account when reviewing potential investments. Environmental criteria focus on how a company performs as a steward of nature. Social criteria look at how it manages its relationship with employees, suppliers and local communities. Governance examines the company’s leadership, executive pay and audits.

The questions were sourced from

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