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5 Questions You Should Ask Your Investment Advisor?

13 April 2020

Every person who believes in stability and preparing for the future needs help to generate wealth and preserve it to cushion him from any financial uncertainty. Investment advisors or financial planners thus, hold a very important part of this journey. A successful investment advisor combines the best of analytical and technical tools and his deep research of various aspects involved in investments and money management abilities to help clients define and reach their financial goals.

So, when it comes to choosing an ideal financial advisor, there are various other responsibilities that they hold, and probably that is the reason that SEBI has been very strict in certifying an entity is a financial advisor. A financial advisor needs to maintain strict standards when it comes to their responsibilities towards a client.

Let’s discuss about some of the roles that an ideal financial advisor should perform:

1. What is my risk appetite level?

The first step of starting any investment journey is assessing risk involved in the investment. Every investment advisor should conduct a risk profiling before proceeding further with any client is to analyze the risk bearing capacity of the client.

Investment world is full of uncertainties, and thus there are chances that the client can lose his money. Knowing the risk appetite helps clients assess how aggressive they can be with their investments and the amount of risk they can bear.

2. Are enough measures being taken to ensure privacy and record keeping?

Investment advisors have access to sensitive financial information about the client. Therefore, it is very important for them to keep the information organized in a detailed manner without compromising on data safety. The agencies governing the advisors can audit the information anytime and thus it is necessary for all the advisors to adhere to the prescribed guidelines by the authorities.

3. Are compliance measures and ethical practices observed?

There is a huge fiduciary responsibility on investment advisors to provide the right information to their clients about investments and to work in a fair and unbiased manner. Since all the clients have faith on their investment advisor, it is extremely crucial for your investment advisor to comply with the privacy norms and ethical practices while dealing with the clients.

The advisors should place the financial well-being of the client above their bottom line by disclosing all the relevant information about an investment, avoiding conflicts of interest.

4. Does your investment advisor help you in becoming more financially aware?

Just like a doctor or a teacher, an investment advisor should help their client become knowledgeable about the financial markets, investments, returns and other things associated with financial planning and wealth management.

There can be many clients who are newbies in the field of investments and have never ever travelled on the road to investments. It is important for an investment advisor to educate the client about the financial journey he needs to take to accomplish his goals. It includes giving detailed explanation about all the different types of investment strategies which can benefit, or hinder the client’s investment objectives.

5. What is your investment advisor’s strategy while approaching financial planning?

Everyone has different goals and needs when it comes to investment. It is very important for the investment advisor to discuss in detail about the same with the client. On the flip side, the client should be aware about the investment strategy best suited for them and ensure that their investment advisor also guides them according to this strategy.

A deep discussion about the investment horizon, planned amount and goals will help in better planning of investment strategies which will further increase the chances of goal accomplishment.

Every investment advisor can give you a cursory plan for planning your finances based on your investing capital. But an ideal financial advisor usually goes a step ahead by performing the above roles and responsibilities towards a client. You should discuss the above points before finalizing your investment advisor.

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Complaint Board
As On 30th April, 2020
Beginning of month Received during the month Resolved during the month Pending at the end of the month Reason for pendency
214 0 0 1 Closed by us, Filed ATR, SCORES approval awaited

Total clients served so far Total complaints received so far % complaint on customer base
70,000+ Customers 214 0.30%

Data is updated on 7th per month. It gets verified every quarter by independent auditor.

Data presented here is taken from company's inception

Importance given to satisfactory resolution as per prescribed TAT