The area of product development is an important one in financial services and it is specifically crucial when it comes to investment management. Determining what asset management fund products will be released, in what countries and at which times are pivotal decisions for any firm. Those in product development are often the ones who make to the final decision on which asset management products their investors will have to choose from and their pricing structure. If you've got your ear to the floor regarding what's new and what could be a big hit, then this may be the career for you.

The Role of Product Development
In seeking to launch new products, those in the product development department often search for gaps in the product lines. When a new fund is in the process of being established, those in product development work with the legal and compliance teams to make sure the investment vehicle meets all regulatory and legal requirements. They also work closely with the marketing and sales departments to craft the promotional material for the new investment product. (For more on this process, read On The Record: Communications With The Public.)


The product development team also plays a role in assessing competitors' products. This allows the team to ensure that their firm's products are adequately positioned to compete effectively. As a result of their competitive intelligence, they will often make recommendations when it comes to merging or eliminating funds, and setting the pricing of funds. (Keep reading on this subject in Where do most fund managers get their market information?)

Product Development: What It Takes
While staffers in product development often have experience in other areas of investment management, entry-level positions do open up from time to time depending on the company. If you are an undergraduate student considering a career in investment management product development, you might want to consider taking courses in economics, accounting, math and marketing. A graduate MBA degree is always looked favorably upon by investment management firms. Even if you don't have an MBA, however, enrolling in the CFA or the CAIA programs may also be helpful.


  • The Chartered Financial Analyst (CFA) program, offered by the CFA Institute, consists of three levels of tests that you can study for independently. Passing all three levels, in addition to gaining four years of eligible work experience and completing a professional conduct statement, will earn you the CFA charter. Because this charter is so hard to earn, it is a highly regarded emblem of knowledge within the investment community. (To read more on obtaining the CFA Charter, see Pass Your CFA Exams The First Time and So, You Want To Earn Your CFA?)
  • The Chartered Alternative Investment Analyst (CAIA) program offers a curriculum focused on alternative investments. The specialized CAIA program has two levels of exams that cover hedge fund and private equity investment products as well as real estate, managed futures and commodity products. The CAIA designation is conferred by the Chartered Alternative Investment Analyst Association upon those who complete the program and have at least one year of professional experience.
Developing Offshore Products
Either the CFA or the CAIA designations could be of great value within an offshore product development department. Offshore product development focuses on the launch, sale and marketing of funds off the domestic shore of the United States. Legal regulations vary considerably in different countries and offshore product development staffers must work carefully with legal and compliance departments to make certain that the funds are compliant for each country in which they are issued. Sales and marketing approaches must also be tweaked depending upon the country in which the investment vehicle is issued - especially when a particular country has important cultural traits to consider when determining successful marketing and sales strategies.


Some staffers within product development choose to specialize in offshore marketing due to these compelling challenges. However, when you are first hired with a product development department, you will generally learn the ropes of domestic product marketing - or the practice of developing fund products sold within the confines of the United States - before moving on to offshore investment vehicles. (For related reading, see Pros And Cons Of Offshore Investing.)

What To Expect
A day in the life of a product development staffer is varied, complex and incredibly up to date. As with most in the investment fields, those in product development tend to start the day by reading The Wall Street Journal and the Financial Times, watching CNBC and financial news shows, and perusing online forums and sites that discuss current financial events and developments.


A member of a product development staff may have an early morning meeting with the legal department in order to go over the prospectus for the launch of a new fund. Right after that meeting, there may be a similar gathering within the compliance department in order to go over compliance issues with that same fund that is due to launch in the near future.

Over lunch, the product development department may informally eat together in order to compare notes and discuss the latest developments on fund launches. The afternoon may bring meetings with the sales and marketing departments in order to discuss another investment vehicle that has recently launched. Topics might be on the collateral required to sell the fund, or briefing the sales force on the best way to position the sale of the fund with potential investors.

Finally, before the staffer heads home that day, he or she may pour over competitor pricing data in order to consider a pricing strategy for a new fund product about to launch. Some of these reports may find their way into the staffer's briefcase to continue to assess over dinner or at home.

Pursuing the Product Development Dream
Product development is a challenging - but ultimately rewarding - career path within an investment management firm. Those in product development have their fingers on the pulse of exciting new fund launches and are integral in developing the strategies behind new products. If you like the idea of being at the center of this storm, you might want to consider a career in product development.


If you're not interested in product development, but would like to still pursue a financial career, see Finding Your Place In The Financial Industry.



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