Assets Under Management (AUM)

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Assets under management (AUM) is a measure of the total value of assets that a financial institution, such as a mutual fund or hedge fund, manages on behalf of its clients. AUM is calculated by adding up the value of all of the assets that the institution holds, including cash, securities, and other investments.

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AUM is an important metric for investors to consider when evaluating a financial institution. A large AUM can indicate that the institution has a lot of experience and expertise in managing assets, and it can also give investors a sense of the size of the institution and the potential for growth. However, it is important to note that AUM is not always a good indicator of performance. Some institutions with large AUMs may not be as successful as those with smaller AUMs.

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AUM is also used by financial institutions to calculate their fees. The fees that an institution charges are typically based on a percentage of AUM. This means that the larger the AUM, the more fees the institution will earn.

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AUM is a valuable metric for investors and financial institutions alike. However, it is important to remember that AUM is not always a good indicator of performance. Investors should always do their own research before investing in any financial institution.