BASL Registration Number: 1951 | Non-Individual RIA. Regn No. INA000017620 | Validity Perpetual
Financial Advisor
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Financial Partner
Conflicting recommendations by professionals or experts from different areas is one of the leading causes for sub optimal decisions, especially in the area of personal finance. So, while your investment advisor maybe harping on returns, your chartered accountant would guide on the tax rates applicable to a certain investment related income and broadly looking at complications of accounting and reporting income. Your legal counsel might be more concerned with product structure & titling.
We see it as a very important role for us to be able to reconcile these conflicts, put them in proper perspective and help this group take a decision in your best interest. It means an ability to effectively use the expertise of professionals and channelize it for a very specific purpose i.e. your (financial) wellbeing.
And we see this not just as a technical capability; we see it as a personal capability to be able to work with a team of diverse strengths and opinions.
Not having an Advisor is expensive… very expensive.
As Advisors we ensure that you stay disciplined in your savings/investments and of course do the due diligence of where and how much to invest. Most importantly, we protect you from getting swayed by the media and unsolicited advice from friends, colleagues and make an investment decision, which can go horribly wrong denting your finances in a big way.
If you think your Financial Goals are important and your priority is to achieve them, then our fee is reasonable.
The role of Financial Advisory is to use our experience and knowledge to consult with clients so that we can fully support them with meeting the challenges they face for accomplishing the goals they have set for themselves.
We see Investment advice as only a subset of Financial Advice. Financial Advisory has a much bigger role. While our investment management skills are much appreciated by our clients, we see our role in the bigger context of solving numerous challenges, over and above those of managing money.
Our advisory process begins by understanding your financial situation, helping you articulate your goals, working with you in creating a plan of action and pre-empting financial issues which may be anticipated.
Our common aim is to see that your Financial goals are met through your investment assets, your savings and a disciplined approach towards investments. In the process, we have to be mindful of the returns required to achieve those goals and at the same time your risk tolerance towards “high growth high risk” investments required for these returns.
It is of utmost importance to focus on your goals and that the investment portfolio is structured such that you make the desired returns without taking unnecessary risk. We believe that it is important to be disciplined in your savings/Investments. It should be borne in mind that you don’t sway from this discipline by getting influenced by the chatter around you (media, friends, colleagues) and take adhoc decisions.
While our endeavour is to expedite the execution process and we believe that our clients consider us to be very efficient with it, we see this only as an activity incidental to the more important process of advice.
Traditionally, in India, so called “advice” has been meted out by distributors/agents who represent mutual funds, insurance companies, etc and are compensated by them. VSK represents only you the client. The interaction between the client and advisor revolves around the use of knowledge, judgement & experience of the advisor for the benefit of the client’s financial well-being.
This is similar to a doctor who is supposed to look after the patient’s physiological well-being. In our experience, this interaction works best for the client in a professional setting which is the advisor’s office. Besides, the latter has access to all the tools, documents and information that he needs to engage in a meaningful and purposeful conversation.
It is an aspiration for us to be using technology to make physical presence in any geographical location irrelevant for the client as well as ourselves.
However, in reality while some clients are extremely comfortable with dealing over conference calls and skype video call, many still feel the need to meet in person. We are very comfortable either ways.
Many times, clients prefer meetings as often as weekly or monthly to discuss their portfolio and make changes based on timing the market. We are strong opponents of constant portfolio reviews and have learnt from experience as well as research that this level and frequency harms the financial interest of the clients.
Even from a personal perspective, it distracts the client from focusing on his/her personal life, career and goals. We recommend portfolio review meetings based on specific client situations and typically range from 1 to 4 meetings a year either in person or over skype or phone. Meetings are more necessary when we are working on specific assignment such as Financial Planning or Will preparation and there is a concentrated effort to accomplish the desired outcome.
Once these urgent tasks are accomplished, frequent meetings may not be that necessary. Of course, if there is a drastic change in the market scenario necessitating a discussion we might ask for a meeting and similarly if there is a life changing situation in your personal circumstances, you can also initiate a meeting.
We realize the importance of communicating to you on the matters that affect you. We also realize that you are busy with your own work and although the need to know is important, it is equally important that we convey the message in a brief and succinct manner.
We would like to mention here that it is also equally important that you communicate to us, transformations, financial or personal, so that we are fully cognizant of your situation and can accordingly make changes whenever required.
Technical competency and analytical capabilities of any advisory practice are the most critical components that go into creation of great recommendations and advice. But we feel that for implementation of this best advice, an advisor requires to be empathetic and a good listener.
We believe the true test of good advice is whether the advisor would do precisely what he is telling you to do, if he had been in the same situation as you. Hence, we see it as a top requirement for us to understand your personal situation and point of view.
Managing investments actively has been glorified by stories and movies alike. The stock trader has been portrayed as very wealthy. In real life trading involves costs viz. transaction costs in terms of brokerage, securities transaction tax, capital gains taxes and platform fees.
Add to that the cost of the investor’s time and energy which in our opinion truly begs justification especially when there is no commensurate benefit. In fact, in our experience the hectic activity of trading is usually rewarded by a lower than optimum return not just because of higher costs but because of impulsive decisions based on knee jerk reactions or arbitrary mathematical models. We see wisdom in longer term decisions that are not harried by the noise of the daily vacillations of the market.
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When we sign on clients we are committed to find solutions to all their financial and many times personal problems. Naturally, we may not have solutions to all their problems but we feel it is important that we have conversations with the clients and identify the problem, discuss how best they could be addressed and fully support them through the process of identifying the right expert and find their solution.
Choosing a financial advisor is as much of a task as juggling with various financial responsibilities and choosing from a maze of complicated investment products. Then, there are the market mavens, who proclaim themselves as financial advisors like the next-door insurance agent, the over friendly bank relationship manager, the know it all broker/distributor in the neighbourhood, etc. The line of distinction between selling and professional advice thus gets blurred.
How do you differentiate? What kind of expectations do you have while engaging a financial advisor? Out of the following list, choose the 3 important aspects of engaging with a financial advisor which matter the most to you. This will help you set the right expectations. This quiz will also enable you to ascertain whether our line of thoughts on managing personal finance match and if we are the right fit for you.