Assets Under Management (AUM)

November 21, 2023 - Around 2 mins mins to read

Understanding Assets Under Management (AUM)

Assets under management (AUM), also known as funds under management, refers to the total market value of investments or assets that a hedge fund, mutual fund, or wealth management company oversees on behalf of their clients. The value of AUM fluctuates based on fund performance and investor fund inflow or outflow.

AUM is a widely used concept in the cryptocurrency and DeFi (Decentralized Finance) space. For individuals new to the crypto industry, finding a trustworthy wallet and exchange that supports their desired cryptocurrencies can be overwhelming. It is recommended to choose wallets and exchanges that offer support for a wide range of coins and tokens.

To simplify the process, many agencies have introduced a new tool called asset management. These crypto asset management platforms help customers consolidate their holdings, eliminating the need to manage multiple accounts and wallets.

AUM serves as a significant indicator that encompasses all aspects of funds and cryptocurrencies. If the AUM is $1 million or less, it is considered relatively small-scale. However, if it exceeds $1 billion, it is considered a substantial project. Regulated funds typically require third-party services such as fund administrators, auditors, and custodians, which necessitate a minimum AUM of $10 million to cover operational expenses. In most countries, managing a fund requires obtaining a license from the local securities exchange commissions.

Author:

Varit Bulakul holds the position of president of investment banking and digital assets at The Brooker Group, a publicly listed financial consultancy and capital management company based in Thailand. Varit played a crucial role in the Brooker Group’s transition to digital assets and is leading the company’s vision of integrating the digital asset ecosystem into traditional financial services. The Brooker Group made history as the first publicly listed company to directly invest in DeFi and DApps projects.

Prior to joining the Brooker Group, Varit worked as an auditor at Deloitte in Bangkok. He holds a BA in Science in Accounting and Finance from Lehigh University and a master’s degree in Accounting from Boston College.