• The principle of accurate consulting
• Duties in detail
• Responsibilities of the asset manager in principle
• Breach of contract
• Damage
• Causation
• Indicators of faulty asset management

Causation

Between breach of contract meaning the careless actions of the asset manager and the loss suffered, there has to be causation. Only this inner connection qualifies a simple damage to be a legally qualifying damage.

If the investor for example instructs the asset manager to sell certain securities and the asset manager fails to comply, there is a connection between the non-compliance with the purchase order and any subsequent collapse of prices. The investor may now claim damages being the difference between the current value at the time when the asset manager should have sold and the actual sales price.

The same applies if the asset manager suggests an unsuitable and too risky investment strategy for an investor, who depends on the return from his assets in order to cover his living expenses. In the event that the investor suffers losses, the advice to invest in the shares was causal for his losses.