PARALLELING THE ENORMOUS forward strides of business management techniques and skills has been a vigorous application of such techniques to the problem of investing. One result has been a broadening in the scope of investment management and realization that it must effectively mesh with other areas heretofore not considered as being directly affected by investment decisions. Although this change is evident in the management of all types of portfolios, it is applicable particularly to the more complex investment problems associated with insurance companies. Having both investment portfolios and operating divisions, insurance companies have more variables than most investors to consider in management of their portfolios. Additionally, the industry is a regulated one and is limited to a degree in the type and mix of securities permitted (although these restrictions are less onerous than many outside the industry imagine). Consequently, insurance companies are singled out because they lend themselves so well to an examination of one of the basic theses of this study: the scope of investment management has broadened out and become integrated with seemingly non-investment considerations. By no means is this thesis restricted to insurance companies: under certain circumstances estate planning objectives can be furthered for individual investors, some restrictions in trust instruments can be effectively bypassed, and additional income can be accumulated in personal holding companies without tax danger by the selection of certain types of securities. This list of examples could be extended manyfold, reflecting increasing professionalization of the investment industry. Investment management can be thought of as a series of interrelated but distinct functions: selection of investment objectives, portfolio strategy, investment strategy, portfolio management, timing and security analysis. The definitions given below of these terms differ in one or two instances from those generally accepted by the investment community. This is true particularly of the term investment strategy. It also can be argued that a six-part subclassification of investment management is too fragmented and that certain of these functions should be grouped together-specifically, portfolio strategy and timing should be part of portfolio management. Although the same person or persons may be involved in these three areas, functionally it is not necessary. Investment counsel firms and the investment divisions of banks tend toward a separation of these functions. Where an investor is so large as to have its own investment division, the cleavage between these functions may be blurred, particularly with one or two individuals wearing several hats. However, the cleavage is still there and will become increasingly apparent as the investment industry becomes even more professional. The computer will accelerate this tendency.