Definition of Assets Under Management (AUM)
What are assets under management?
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What is the definition of the term assets under management? What does AUM mean?
Assets under management (or AUM) refers to the total value of the assets that a person such as a hedge fund manager or mutual fund manages.
Assets under management obviously refers to the total market value of the assets under management.
Assets under management includes:
a) investor capital
b) capital that belongs to the principals of the management firm
So, if a hedge fund manager has $3 billion of his own capital in the fund, then this amount is also included in the assets under management total.
So, next time you hear that a hedge fund firm has "$13 billion AUM" - this means that they currently have $13 billion in assets under management.
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