Portfolio management
Managing a client's investment portfolio at the firm's discretion, under an individual mandate, needs an investment firm licence, a fund manager licence or a banking licence under MiFID II Annex I, Section A(4). The manager builds a client suitability profile, follows the mandate and reports on the portfolio regularly, then can passport across the EEA.
Definition
Managing client portfolios that include financial instruments on a discretionary, client-by-client basis.
- MiFID II, Annex I, Section A(4): official text
Which licence you need
Licence families that typically permit this activity:
- FM · Abu Dhabi Global Market (ADGM)
Fund manager licence
Financial Services Permission for Managing a Collective Investment Fund (Category 3C)FSRA
- IF · Australia
Australian financial services licence (AFSL)
ASIC
- FM · Bermuda
Fund Administrator Licence
Fund Administrator Licence (Part III, Investment Funds Act 2006)BMA
- IF · Bermuda
Investment Business Licence
Investment Business Licence (standard licence, under the Investment Business Act 2003)BMA
- FM · British Virgin Islands
Fund manager licence
BVI mutual fund recognition (private/professional fund), registration (public fund) or approval (incubator/approved fund) - funds are recognised/registered/approved, not 'licensed'BVI FSC
- IF · Cayman Islands
Securities Investment Business Licence / Registered Person
CIMA
- IF · Cyprus
Cyprus Investment Firm (CIF) authorisation
CySEC
- FM · Czech Republic
Investment Company / Fund Manager licence
CNB
- IF · Czech Republic
Investment Firm licence
CNB
- FM · Dubai International Financial Centre (DIFC)
Fund manager licence
Financial Services Permission for Managing a Collective Investment Fund (Category 3C)DFSA
- FM · Estonia
Operating licence as a fund management company
FI
- IF · Estonia
Authorisation as an investment firm
FI
- FM · France
Portfolio management company authorisation
AMF
- FM · Germany
Investment management company licence
BaFin
- IF · Germany
Investment firm licence
BaFin
- IF · Ireland
Investment Firm Authorisation (MiFID II)
CBI
- IF · Italy
Investment firm licence (SIM)
CONSOB
- IF · Latvia
Investment firm licence
LB
- IF · Lithuania
Financial brokerage firm licence
LB
- IF · Luxembourg
Investment firm authorisation
CSSF
- IF · Malta
Investment services licence (Category 1, 2, or 3)
MFSA
- IF · Netherlands
Investment firm licence
Investment firm licence (Vergunning beleggingsonderneming) under Wft Article 2:96 and MiFID IIAFM
- FM · Poland
Investment Fund Company licence
KNF
- IF · Poland
Brokerage House licence (dom maklerski)
KNF
- FM · Seychelles
Fund Administrator's Licence
Fund Administrator's Licence (and Restricted Fund Administrator's Licence) under the Mutual Fund and Hedge Fund Act 2008FSA
- IF · Seychelles
Securities Dealer's Licence
FSA
- IF · Singapore
Capital Markets Services (CMS) Licence
MAS
- IF · Slovakia
Investment firm licence
NBS
- IF · South Africa
Financial Services Provider licence - Category II (discretionary FSP)
FSCA
- FM · Spain
Fund manager licence (SGIIC)
CNMV
- IF · Spain
AV) investment firm licence
CNMV
- FM · Switzerland
Fund management company licence
FINMA
- FM · Switzerland
Manager of collective assets licence
FINMA
- IF · Switzerland
Portfolio manager licence
FINMA
- IF · Switzerland
Securities firm licence
FINMA
- IF · United Kingdom
MIFIDPRU Investment Firm Authorisation (Part 4A FSMA)
FCA
Where it can be licensed
Frequently asked questions
How does discretionary portfolio management differ from collective fund management?
Discretionary portfolio management works client by client: assets stay segregated in that client's own custodial account, under a specific mandate. A fund manager instead pools money into a collective investment vehicle, where investors hold units or shares in one fund entity.
What suitability obligations govern discretionary portfolio managers?
Before setting up a discretionary portfolio, the manager assesses the client's financial position, investment objectives, knowledge, experience and capacity to absorb losses. From then on, the portfolio allocation has to stay consistent with the agreed strategy and risk profile.
Sources
- MiFID II Annex I, Section A(4) · retrieved 2026-09-24
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