What is are Assets Under Management (AUM)?

In order to understand this article, we must understand what Assets Under Management or AUM are. According to Investopedia;

“Assets Under Management are the total market value of assets that an investment company or financial institution manages on behalf of investors. Assets under management definitions and formulas vary by company.”

In laymen terms, AUM are when you give your money to a company with the expectation of growing the amount you gave them by the time it is returned to you. Easy enough, right?

Example:

Jack had $100 left over after paying his monthly bills. Instead of spending that $100 extra dollars on, say, beer; Jack decides his financial future is

more important and seeks out a trustworthy institution to deposit his money with to grow it. Since Jack is expecting the financial institution to do all of the work, they are going to charge him a fee. Fair enough, right? Well, not really…

The Transparency Problem

For decades now, financial institutions who manage funds for their investors have operated in a hazy fashion. What I mean by this is that the parties involved in the $70 Trillion AUM market are not necessarily required to publish all of their trades or their sources of profit. With the increase in technology and the democratization of access to high-risk, high-growth investments increasing — transparency around money management has become a much more focused topic in the financial services industry.

Just think about it. Imagine you save up $1,000,000 and want to grow those funds, but do not have ANY technical finance knowledge because you worked at a computer tech firm. Years of hard work. Would you not want to know what is happening with your $1,000,000 if you gave it to someone to grow it? I mean, personally, I would want to know EVERY. SINGLE. TRADE that was processed from the very account my money originally went into. Especially because many times, the Broker and Asset Manager is being compensated not just a set percentage annually, but a percentage of the profits they earn you — many times before the portfolio has even begun to earn profits.

The “double-dipping” fee structure mentioned above is commonplace in the financial services industry— this is also why the Genesis Vision Leadership Team has come together.

PricewaterhouseCoopers — Assets Under Management 2020: A Brave New World

Striving to solve industry problems, specifically around transparency, GV Founders realized what was happening behind closed doors and are developing the platform with those aforementioned problems in mind. The various forward-thinking quotes included in the pictures throughout this articles are from PricewaterhouseCoopers, THE go-to audit and assurance, consulting and tax services firm among corporations. Published in 2014, AUM 2020: A Brave New World was a forward-looking, standard-setting report developed with transparency in mind.

After diving very, very deep into the 40-page PwC report, I simply could not ignore how completely aligned this report was with exactly what the Genesis Vision project addresses. Taking a look at the “Advantages for Investors” section in the GV White Paper, we can see just that (image below) — a major match-up between the GV Advantages for Investor and what PricewaterhouseCoopers calls the “6 Gamechangers” influencing the competitive landscape for what is the $70 Trillion Assets Under Management (AUM) market.