Investment management agreement (IMA)

An investment management agreement (IMA) sets the manager’s authority, duties, fees, reporting and termination terms. A discretionary agreement lets the manager trade without asking first. The limits usually sit in a schedule called the investment guidelines or investment restrictions.

For a trust in England and Wales, a written agreement is a legal requirement when trustees delegate asset management. Section 15 of the Trustee Act 2000 also requires a term obliging the manager to comply with the trustees’ policy statement. Charity Commission guidance (CC14) asks for the same pairing of contract and written policy.

Each guideline in the schedule can be written as a rule linked to its clause. “No more than 10% in any one issuer” becomes a 10% issuer cap. A duty to report breaches within a stated number of days becomes a manual obligation; see IMA investment guidelines.