What Is Chartered Wealth Manager (CWM)

Chartered Wealth Manager (CWM) is a professional designation issued by the Global Academy of Finance and Management (GAFM), formally the American Academy of Financial Management (AAFM). The prerequisites for the CWM program are three years or more of experience in wealth management and a GAFM-approved degree or other approved program.

Understanding Chartered Wealth Manager (CWM)

The Chartered Wealth Manager program focuses on topics such as relationship management, communication, sales, and financial planning and requires 15 hours per year of continuing education requirements.

The GAFM is a global institution that offers candidates certification to improve their knowledge and credentials in finance, accounting, and management consulting. It offers other certifications such as Accredited Financial Analyst (AFA), Accredited Management Consultant (AMC) and Master Financial Planner (MFP). The GAFM Board of Standards was launched in 1996 through a merger between Founders Advisory Committee of the Original Tax and Estate Planning Law Review and American Academy of Financial Management & Analysts.

Functions of a CWM

A CWM typically assists retail investors with the following:

  • Build Investment Strategies: Chartered Wealth Managers build strategies around their clients' risk tolerances, personal situations, and long-term financial goals. For example, a CWM may build a stock portfolio of high yielding dividend stocks for an investor who seeks passive income.
  • Provide Independent Advice: A CWM analyzes large amounts of financial news and data and provides clients with an independent assessment of the information. For instance, after reading through a prospectus for an upcoming initial public offering (IPO), a CWM may advise his client to avoid investing.
  • Actively Listen: Clients’ circumstances continually change. A CWM organizes regular meetings with investors and determines if a change in their situation requires an investment strategy review. For example, after a client meeting, a CWM may decide to do a portfolio rebalance after learning about an inheritance. Actively listening helps to ensure CWMs satisfy the Know Your Client (KYC) rule.
  • Teaching: A CWM actively educates investors about the financial markets and how to build wealth. They teach their clients about fundamental principles such as diversification, asset allocation, and the importance of discipline. If a CWM has active trading clients, they may explain the importance of capital preservation and risk/reward.
  • Financial Guardian: Chartered wealth managers monitor the markets for clients and alert them to new opportunities or potential risks that might impact their portfolios. For instance, a CWM may inform a client about a surprise profit warning that is likely to negatively impact a portfolio holding.