Client Reporting

Client Reporting: Best Practices for Communicating with Clients in Asset Management

Organisations and established investors often depend on others for portfolio and asset management. Since organisations focus on their core competencies, they transfer the asset management processes to a third party. Similarly, institutional investors and HNIs employ asset managers to look after their portfolios. Asset managers, fund brokers, investment banks, and other entities offer portfolio management services to organisations and investors. Asset managers and consultants must inform their clients about the portfolio performance, risk profile, and other factors. It can happen when asset managers focus on effective client reporting. Let us discuss the best practices for communicating with clients in asset management.

Comprehending Client Reporting

Before discussing the best practices, it is essential to understand the concept of client reporting in detail. Client Reporting is the process of collecting, analysing, and presenting relevant information for asset management clients. Asset managers provide clients with performance reports, market analysis, portfolio holdings, and other details. These reports allow the client to analyse their holdings and portfolio performance. They can make informed portfolio decisions with the aid of these reports. Besides offering insights, client reporting also maintains transparency for the clients. In the context of asset management, client reporting might also be referred to as investment reporting. Here are some aspects of client/investment reporting in asset management:

  • Asset managers actively indulge in performance reporting. They offer detailed portfolio performance reports to clients, including returns ratios, risks, benchmarks, and other factors.
  • Asset managers are responsible for giving a detailed view of current holdings. They provide a breakdown of individual assets and their value within the portfolio.
  • Asset managers actively indulge in attribution and risk analysis. It allows clients to make better and more informed portfolio decisions.
  • Asset management clients demand market commentary at frequent intervals. It helps them understand the market conditions and make decisions accordingly.
  • Many clients allow asset managers to buy or sell assets on their behalf. However, clients are made aware of the changes through transaction or activity summary.

Best Practices for Client Reporting in 2023

As discussed above, client reporting allows asset managers to maintain communication with the clients. Through reporting, clients will know about the portfolio performance, risk score, asset allocation, holdings, and other details. Here are the best practices for reporting in asset management:

Understand Your Client

Asset managers must understand their clients before drafting reports. Every client will have different needs, portfolio sizes, and investment strategies. You cannot draft a similar report for every asset management client. There must be a degree of personalisation in your client reports. Asset managers must take some time to figure out the preferences of their clients. Once asset managers understand individual preferences, they can draft effective client reports.

Leverage the Power of Technology

Are you still writing pen and paper-based client reports? It’s 2023, and technology can help draft better client reports. For instance, you can rely on data analysis solutions to derive market insights and performance trends. Similarly, asset managers can rely on portfolio monitoring tools to generate metrics and insights. Technology can decrease the manual burden on asset managers to draft client reports.

Prioritise Data Visualisation

You cannot expect clients to understand large data sets without external help. Asset managers must rely on data visualisation techniques to make information comprehensible for clients. Asset managers can use charts, graphs, and infographics to make data comprehensible for the clients. Let us say the asset manager has included current holdings in its report. The same information can be understood easily when represented within a pie chart. The client will view the pie charts and understand how much portfolio is allocated to different assets.

Include Metrics

Client reports are nothing without metrics and KPIs (Key Performance Indicators). Portfolio management tools can allow asset managers to generate metrics like the Sharpe ratio, annual return, risk-adjusted return, and CAGR. These metrics can help clients understand their portfolio performance and associated risks. Asset managers can also choose custom metrics based on the investment strategies and objectives of clients.


Client reporting is indispensable for asset managers in 2023. They might lose clients by not maintaining proper communication. Asset managers can use digital solutions for analysis, data collection, portfolio monitoring, and other processes. Draft effective client reports in 2023!

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