Asset Management Agreement Template for the United States

An Asset Management Agreement is a comprehensive legal contract that formalizes the relationship between you and a professional investment manager in the United States. This document grants specific authority to manage your financial assets while establishing clear boundaries, responsibilities, and compliance with federal securities regulations.

When do you need this document?

You need this agreement when engaging a professional investment adviser to manage your portfolio, whether you're a high-net-worth individual, institutional investor, or corporate entity. The document becomes essential when delegating investment decisions for retirement funds, endowments, trust assets, or corporate treasury management. Investment advisers are legally required to have written agreements with clients under the Investment Advisers Act of 1940, making this contract mandatory for professional asset management relationships. You'll also need this agreement when establishing relationships with hedge funds, private equity managers, or registered investment advisers managing assets exceeding regulatory thresholds.

Key legal considerations

The agreement must clearly define the scope of investment authority, including specific asset classes, risk parameters, and investment restrictions. Fee structures require transparent disclosure, including management fees, performance fees, and expense allocations to comply with SEC regulations. Fiduciary duty provisions are critical, as investment advisers owe clients the highest standard of care under federal law. The contract should address conflicts of interest, particularly regarding the adviser's other business relationships and potential self-dealing situations. Termination clauses must specify notice requirements, asset transfer procedures, and fee calculations upon contract ending. Reporting obligations should detail frequency and format of performance reports, account statements, and regulatory disclosures required under federal securities laws.

Legal requirements in United States

Asset Management Agreements must comply with the Investment Advisers Act of 1940, which governs registered investment advisers and establishes fiduciary standards. The Securities Act of 1933 and Securities Exchange Act of 1934 impose additional disclosure requirements for certain investment strategies and securities transactions. Under the Dodd-Frank Act, managers of significant assets face enhanced regulatory scrutiny and reporting requirements. State securities laws may impose additional requirements depending on the adviser's registration status and client location. The agreement must include specific disclosures required by SEC Form ADV, including the adviser's business practices, conflicts of interest, and disciplinary history. Performance fee arrangements are restricted under federal law and require specific client qualifications and disclosure provisions. Custody arrangements must comply with the Investment Advisers Act's custody rule, particularly when the adviser has access to client funds or securities.