How to Become a Portfolio Manager: Career Development, Requirements and Timeline

Moving into portfolio management may feel like a natural step if you’d like to advance your financial advisor career. It’s possible you may be able to unlock a new client base, while increasing earnings and doing work that you’re passionate about. The process for how to become a portfolio manager begins with obtaining a degree; FINRA licensing and professional credentials may also be required.

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Portfolio Manager Overview

Portfolio managers are financial professionals who develop investment strategies that are aligned with their clients’ goals and risk tolerance. A portfolio manager may work with individual investors or institutional investors who need help constructing a portfolio that’s designed to help them meet their investment objectives.

It’s common for portfolio managers to work alongside other financial professionals, including analysts and researchers who gather data about the markets and individual investment products. The portfolio manager effectively serves as the lead or decision-maker of the team, directing clients on the most appropriate times to buy, sell, or hold stocks, bonds, and other investments.

Portfolio managers may work in a variety of settings, including banks, investment firms, and insurance companies. Many registered independent advisors (RIAs) offer portfolio management as a primary or supplementary service.

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Portfolio Manager Average Salary

Financial managers earned a median annual salary of $161,700 in 2024, according to the Bureau of Labor Statistics. ¹ The BLS defines financial managers as individuals who “create financial reports, direct investment activities, and develop plans for the long-term financial goals of their organization.”

If you want to know how to become a portfolio manager, it makes sense to understand your earning potential. Several factors can influence salaries, including:

• Education level
• Experience
• Client base/niche market
• Geographic location
• Assets under management (AUM)

Compared to traditional financial advisors, portfolio managers earn significantly more. Advisors earned a median annual salary of $102,140 in 2024, according to BLS data. That, along with the opportunity for specialization, can make a transition to portfolio management more tempting.

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Portfolio Manager Certification: Education, Experience and Skill Requirements

A career in portfolio management typically begins with earning a four-year degree from an accredited college or university. There’s no specific degree program required, but generally, portfolio managers have a background in accounting, finance, business, computer science, economics, or mathematics.

It’s not unusual for senior portfolio managers to also hold an advanced degree and that may be a requirement for certain roles. For example, if you’re applying for a position as a regional portfolio manager, you may be expected to have a master’s in business administration or economics as a minimum qualification.

Portfolio managers are also expected to have several years of experience working in financial services. That includes experience with investment analysis or portfolio management, as well as supervisory experience for roles that require you to oversee a team. Internships and entry-level positions as a junior financial analyst can provide a starting point for gaining the experience you need.

The typical skill set of a portfolio manager often includes:

• Knowledge of securities and the capital markets
• Analytical and quantitative skills
• Thorough understanding of finance and investment concepts
• Trading skills
• Critical thinking and reasoning skills
• Problem-solving skills
• Portfolio construction skills and experience with portfolio analysis software/tools
• Strong verbal and written communication skills
• Ability to work both independently and as part of a team
• Leadership skills (for advanced portfolio management roles)

Active listening is another helpful skill to have, as it can help you to develop stronger client relationships.

Portfolio Manager Certification and Job Expectations

Professional designations can underscore your expertise and credibility when applying for portfolio manager roles. There are two certifications you may be expected to hold to obtain a position as a portfolio manager:

• Chartered Financial Analyst (CFA): The CFA designation is granted by the CFA Institute. ²
• Certified Portfolio Manager (CPM): The CPM credential is issued by the Academy of Certified Portfolio Managers. ³

Both require you to complete an exam and have a minimum level of work experience. In terms of how they compare, the CFA exam and credential can prepare you to work with institutional clients, manage hedge funds or conduct research in the investment banking space. A CPM designation is catered more toward professionals who are interested in managing portfolios for individual investors.

Regardless of which credential you obtain, both require you to maintain continuing education (CE) credits. You’ll also need to become a CFA Institute member to complete the CFA exam.

Specific job expectations vary by role, but generally, you’re expected to be able to grasp complex investment concepts, perform analysis and research alone or as part of a team, communicate with clients and other team members, prepare reports and observe a fiduciary standard in all client dealings.

You may also need to earn one or more FINRA licenses to fulfill your job duties. For example, if you’ll be buying and selling securities, you’ll need a Series 7 license. FINRA licensing has additional exam requirements you must meet.

Portfolio Manager Client Opportunities and Services

Portfolio managers may work with a range of clients, including:

• Individual investors
• Families
• Small business owners and entrepreneurs
• Hedge funds
• Pension funds
• Endowments
• Charitable foundations
• Donor-advised funds (DAFs)
• Corporations

The types of clients you take on can influence the types of investments you manage in client portfolios. For example, if your primary client base is ultra-high-net-worth individuals, your portfolio construction efforts may include the usual stocks and bonds, as well as alternative investments like commodities, real estate, and foreign currencies.

In terms of what portfolio managers do for their clients, the list may include:

• Investment strategy development
• Investment selection and asset allocation
• Trading and execution
• Portfolio rebalancing
• Reporting
• Risk management analysis

Again, exactly what you do can depend on the clients you serve.

Portfolio Manager Job Outlook

The Bureau of Labor Statistics estimates that financial managers will experience 15% job growth through 2034. That’s significantly higher than the 3% growth rate expected for all occupations combined.

In total, approximately 74,600 new jobs for financial managers are expected each year. Some of the factors driving portfolio manager job growth include the need to fill positions left by managers who retire, an expanding economy, and an increased need for risk management within the financial services industry.

Transferable Skills and Experience

Many of the skills required to become a portfolio manager can be used in other financial services roles. Communication skills, leadership skills, and investment analysis skills, for example, could prove valuable if you want to pivot into retirement planning or wealth management, or go independent and start an RIA.

The more years of experience you have under your belt, the broader your job options may be. For instance, you may find it easier to move from individual client services to working with institutional investors at a large private bank if you have a decade of portfolio management behind you.

Related Jobs/Certifications

Working as a portfolio manager could prepare you for multiple roles. For example, you may be qualified to work as a:

• Hedge fund manager
• Chief investment officer
• Private banker
• Private client advisor
• Trading strategist
• Director of financial planning and analysis

You may decide to pursue other certifications in addition to, or in place of, a CFA or CPM designation. For example, many advisors opt for a Certified Investment Management Analyst (CIMA) certification or a Certified Financial Planner™ (CFP®) mark.

Bottom Line

Learning how to become a portfolio manager may be of interest to you if you’re ready to make a major job change or are preparing to map out your career path for the first time. It may take time to move up the ranks, but your patience may pay off if you’re able to reap long-term rewards.

Tips for Growing Your Advisory Business

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• Portfolio management can be a demanding role and it’s important to consider what a typical daily schedule might look like. Maintaining work/life balance is critical for ensuring job satisfaction now and in the future. Talking to portfolio managers in your network about what they enjoy about their jobs can help you decide if this career path might be a good fit for you.

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