Is a Wealth Management Banker the same as an Investment Banker?
September 8th, 2010
| Tags: Banker, Investment, Management, same, Wealth
Question by Brownie: Is a Wealth Management Banker the same as an Investment Banker?
If not, what is the difference?
Best answer:
Answer by analyst
No Brownie, they are different. A WMB is a banker who is allocated to high net-worth individuals. This varies from country to country, but here in Australia High Net Worth is generally regarded as someone who has over million in disposable assets (but excluding the main residence). Of course some institutions may only kick in at million or higher.
An Investment Banker, while they may work with HNW clients, basically looks after a far wider range of investments and ensures that high rates of return are achieved.
Know better? Leave your own answer in the comments!
Ha ha ha!!! The term “Wealth Management Banker”, itself, should clue you in to the true definition of the term. “Wealth Management Bankers” say that they help affluent clients to manage their wealth. So you have to be pretty darned well-off, in order to avail yourself of the services of a Wealth Management Banker. Of course, “Management”, in this case, can be re-worded as “pilfering”.
Wealth Management Bankers take a fee for managing your money, and for structuring trusts and other tax shelters, so you can leave as much as possible to your heirs, without paying too much in taxes. Every time they touch your money, they take a fee. If they invest your money somewhere, they take a fee, whether the investment is profitable or not. And that is on top of the fees charged by whatever mutual funds or other entities receive the money that the Wealth Management Bankers invest. The purpose of Wealth Management Bankers is to separate fools from their money. “Fools”, in this case, is a re-wording of “people who have money, but who can’t be bothered to devote time and attention to caring for their own wealth”.
An “Investment Banker” is a banker whose client is a corporation, rather than an individual. Investment bankers help companies to structure themselves in the most advantageous manner possible, in order to defend against take-overs and paying taxes. Investment bankers, also, are in the business of buying up the shares of companies and then selling those shares to entities such as mutual funds, and to the public. In this capacity, the investment banker is a middle-man who buys low and sells high, thus making a profit.
So “Wealth Management Bankers” get their money by extracting fees from wealthy individuals, while “Investment Bankers” get their money by extracting fees from corporations, and by selling corporate shares to the public at a price higher than the Investment Banker paid for them.