Discretionary investment management

Discretionary investment management is a form of professional investment management in which investments are made on behalf of clients through a variety of securities. The term "discretionary" refers to investment decisions being made by the investment manager based on the investment manager's judgement rather than under the direction of the client. The major aim of the services offered is to outperform benchmarks listed in the mandate; this is called providing alpha.

The investment management company has a continuous responsibility to ensure that an investment portfolio is suitable for the client's attitude to risk and investment objectives. The services provided are usually tailored for institutional business, pension funds and high-net worth individuals. The services are increasingly accessible to a broader range of clients through robo advisors.

Unlike discretionary investment management, do-it-yourself investing requires the individual to research, select, and manage investments by themselves.

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