Managment Styles (Стили менеджмента)

Introduction
Autocratic Management Style
Conflict Management Style
Democratic Management Style
Participative Management Style
Conclusion
Glossary
List of literature
Application

In multi-sector managed funds the fund manager does this for you. Top
About risk
No risk can be a risk in itselfRising prices due to inflation can erode the real value, or purchasing power of your investments. In some cases, the real value of your money may actually fall over time.
Market riskThis is the risk that share, property, fixed interest or cash markets will decline in value. The sharemarket is influenced by a number of factors, including the underlying strength of the economy, political factors, industry trends and investor sentiment. On the other hand, fixed interest and cash markets are influenced by expectations for interest rates and inflation.
Currency riskInternational investments are subject to fluctuations in the value of the Australian dollar against other currencies. Currency movements can seriously impact the return on your investments, when you convert your returns into local dollars. For example, when the $A appreciates dramatically against the $US and the profits are repatriated to Australia, they then convert into fewer $As than they would have if the $A had been weaker. The converse also applies. Some funds use hedging to reduce the impact of currency fluctuations.
Economic and political riskEconomic and political factors play an important role in the performance of investment markets. Economic factors include economic growth, inflation, employment, interest rates and business sentiment. Changes in government, political uncertainty and international conflicts can also impact markets.
Credit riskFunds that invest in fixed interest and debt securities are subject to credit risk. This is the possibility that an issuer will fail to repay interest and principal in a timely manner (also known as default risk). By holding a diversified portfolio of high quality securities this risk can be reduced.
Manager riskManager risk is where a managed fund underperforms its benchmark or market index due to poor investment selection. Active fund managers will try to pick stocks they believe will outperform the market based on their philosophy and research. Sometimes this works in their favour and sometimes it doesn’t. Some active funds rely on individual fund managers for their performance and can be subject to key person risk if that manager decides to leave.
How much risk can you tolerate?Your attitude to risk is one of the most important factors when considering a managed fund. While growth assets, like shares and property securities, tend to have more volatile returns over the shorter-term – meaning they are likely to produce negative returns more often than income type investments – they have the potential to produce higher returns over longer-term timeframes.
The Australian Securities and Investments Commission suggests investors can expect a negative return once in every four years for shares, six years for property and eight years for fixed interest.
Generally, the longer your investment timeframe and risk tolerance level the higher the level of growth assets you can include in your portfolio. As the graph opposite shows, over time, the ups and downs of investment markets tend to even out and the gap between the highest and lowest returns closes. This is why it is important to consider your investment timeframe when choosing a managed fund.
Smart investing tip 4 – costs matterCosts can take a large chunk out of your investment return. So, it’s important to compare fund fees before you invest. Look at things like contribution fees, adviser commissions and management fees as these can all add up over time. Not all managed funds charge these fees, so make sure you examine the fine print and know exactly what you are paying for and how much. Top
Controlling risk
Spreading your money across a range of investments is one of the best ways to reduce your exposure to market risk. This way you are not relying on the returns of a single investment. Investment markets move up and down at different times. With a diversified portfolio of investments, returns from better performing investments can help offset those that underperform.
You can achieve diversification through a managed fund in a number of ways:
invest in a fund that has exposure to different asset sectors, such as shares, fixed interest and property;
invest in a fund that holds a spread of investments within an asset sector, such as different countries, industries and companies; and
invest in a number of managed funds managed by different fund managers. For example, blending active funds with index funds – this is covered in the ‘types of fund managers’ section.
Top
The lowdown on fees
Like any other investment, there are fees involved when investing in a managed fund. The types of fees charged will vary from fund to fund and depend on the type of investment chosen. All managed fund fees must be disclosed in the fund’s PDS.
The managed funds industry is regulated by the Australian Securities and Investments Commission (ASIC). Under the Corporations Act, all managed funds must disclose their fees and charges in a standardised format. Where possible, fund managers must give investors examples of the fees charged in dollar terms. This helps investors compare the fees across different funds.
Types of feesThe types of fees you may pay when investing in managed funds are outlined below. Not all funds charge all of these fees, so check the PDS for information on fees before you invest. For example, Vanguard doesn’t charge entry or exit fees, contribution or switching fees (apart from the usual buy-sell spreads that apply to all transactions) and does not pay commissions to advisers.
Higher fees can eat into investment returnsLower costs can translate into better performance for investors over the long term. One of the major advantages of using an index fund is the lower costs. In fact, Vanguard’s retail fund costs are around half the industry median.
Fees can accumulate over time and impact your final investment results. The table below shows how managed cost differences between funds can affect your total return over time. This example assumes an average return for the periods stated for a $20,000 investment. Fund A has a higher management cost than Fund B.
Top
Tax: the hidden cost*
Distributions paid to you from a managed fund throughout the year are assessed as part of your taxable income just like other income you receive, such as rent, wages and bank interest. Some asset sectors, like shares, provide tax concessions  through dividend imputation. Because companies listed on the Australian Stock Exchange have already paid tax on the profits they distribute, investors receive a franking credit for the amount of tax the company has paid.
Investors can use franking credits as an offset against their income tax liability. For example, a person on the top marginal tax rate who receives a fully franked dividend would receive a tax credit of 15 per cent on their distribution. This represents the difference between the highest marginal tax rate of 45 per cent and the company tax rate of 30 per cent as at 1 July 2008. For investors on a marginal tax rate of 30 per cent, their distribution would be free of further tax.
Like direct share investors, unitholders in managed funds may also have to pay capital gains tax. Capital gains are generally only taxable once realised, that is, when the asset is sold for a profit. For investments held for more than a year, certain discounts may apply to the amount of the capital gain that is taxable, for example for an individual investor only half of the capital gain will be taxable, while for a superannuation fund investor, only two thirds of the capital gain will be taxable. For short-term capital gains (on assets held for less than 12 months), the entire capital gain will be taxable. Similarly, if you redeem some or all of your units in a managed fund and you have made a profit – you may have to pay capital gains tax on that profit, and the discounts as described above may also apply.
* Vanguard does not give or purport to give tax advice. You should seek professional advice relating to your own particular circumstances as taxation laws are very complex and subject to constant and rapid change. Top
Some investment styles are more tax-effective than others How tax efficient are managed funds? The main factors impacting the tax efficiency of a managed fund are; the fund manager’s investment process (turnover levels provide a good indication of tax effectiveness), the type of fund (imputation, small cap, sectorial bias etc) and the tax structure of the fund (super vs non-super).
As most fund managers publish their returns on a before-tax basis, turnover can often be overlooked when selecting fund managers. Turnover of a fund manager’s assets reflects the level of trading activity within a fund and is usually much higher in active funds. Some fund managers can turnover their portfolios by 100 per cent or more in a year.
Fund managers that regularly turnover their investment portfolios will attract much higher realised capital gains than those that use a ‘buy-and-hold’ approach, like Vanguard. For example, Vanguard’s Australian Share Index Fund has a turnover level of less than 5 per cent.
A fund manager’s investment approach can make a big difference to the amount of tax you pay on your investment earnings and the amount of investment return you get to keep.
Smart investing tip 5 – less tax can mean higher returnsWhat’s left in your pocket after tax is what really counts. Actively managed funds usually trade more often, which means they may generate more capital gains tax liabilities that can reduce returns. Index funds trade less, so they realise capital gains less often. Top
Investment styles
A management style is a framework that guides the way fund managers evaluate and select the investments they make. It is like a set of principles based on the fund manager’s beliefs about investment markets.
When choosing a fund manager, it is important that you feel comfortable with their investment style. As different investment styles perform better at different times, some investors choose a number of different fund managers to manage their investments. This gives them a more diversified pool of assets.
Active and index fund managersIndex managers aim to match the performance of a market index by investing in all or a representative sample of the securities in the index. A benchmark index measures the performance of a basket of securities. For example, the S&P/ASX 300 Index measures the performance of about 300 companies listed on the Australian Stock Exchange. Index funds invest in all or most of the securities in the index providing diversification, which means lower risk.
Active fund managers will usually try to outperform the market index by choosing a selection of stocks they believe will outperform the benchmark index. Active fund managers will hold a much smaller portfolio of stocks than index managers and they tend to charge higher fees as they have higher costs in the form of research analysts as well as transaction costs from trading securities much more often.
There are several different active investment styles but the three most common are ‘growth’, ‘value’ and ‘style-neutral’ (also known as core). For example, growth managers favour companies that have a solid earnings growth outlook. Value managers will look for market inefficiencies in the market and seek stocks they believe are undervalued in the market.
Long-term performance historyIndexing has a proven long-term performance history in all the major asset classes. Historically, few active managershave been able to sustain above benchmark returns after costs over the long term.
The graph below compares the median return for managers in the Mercer Retail Investment Surveys against the relevant index in each asset class over the last five years.
Low costsIndexing’s ‘buy and hold’ approach can significantly reduce the cost of investing over time. This combined with low management costs means you can keep more of the returns you earn.
Tax-effectiveTax can potentially take the largest chunk out of your investment return so it pays to focus on your real return, after-tax. Because of its long-term nature, indexing benefits from capital gains discounts and the deferral of capital gains liabilities, which can improve after-tax returns.
DiversificationIndex funds invest in all or most of the securities in an index, so they provide diversification. Diversifying across a range of asset sectors, industries and securities reduces market risk and can improve your performance potential.
SimplicityIt is very difficult to continually pick winners and outperform the market over the long term. Index funds take the guesswork out of investing by providing a low cost way to gain exposure to investment markets.
Top
The indexing pioneers
Vanguard pioneered the concept of indexing, introducing the first retail fund in the US in 1976. Vanguard has since become one of the world's most experienced and successful indexing specialists. In fact, the Vanguard Group manages more than US$1 trillion worldwide (as at November 2008).
In Australia, we've been helping professional and personal investors invest through our unique style of indexing for more than ten years.
Top
Vanguard® index funds
Personal and professional investors can benefit from Vanguard's high quality, low-cost investment solutions.
Vanguard's indexing approach is a proven long-term strategy for wealth, super and self managed super fund investors alike. Our funds are available directly or on a wide range of platforms through financial advisers, and include:
Vanguard's Investor Index Funds are suitable for individuals, joint investors, SMSF investors, businesses and trusts.
Vanguard's Personal Superannuation Plan is a flexible super plan you can use throughout your working life.
Vanguard's Personal Pension Plan offers a flexible account-based pension for retirees seeking a tax-effective income stream.
With Vanguard's low fees, around half the industry average of retail managed funds, you can be assured your investments are off to a head start. Scaled management costs apply to balances over $50,000 so the more you invest the less you pay. And there are no upfront fees. Investors with larger sums to invest can access our range of index funds at wholesale rates.
Robbins, Stephen P. Essentials of Organizational Behavior.
Mescon, M.H., C.L. Bovee, and J.V. Thill. Business Today.
Mescon, M.H., C.L. Bovee, and J.V. Thill. Business Today.
Cherrington, D.J. Organizational Behavior: The Management of Individual and Organizational Performance.
Mescon, M.H., C.L. Bovee, and J.V. Thill. Business Today.
http://www.solhaam.org/articles/clm2.html
http://www.solhaam.org/articles/clm2.html
http://www.solhaam.org/articles/clm2.html
3