In an interview with Shweta Dhoka of Myiris.com, Arvind U Trivedi, Financial Advisor, Etica Wealth Management, says, "Retail investor should continue SIP in equity funds as the next 2-3 years would be prove return generating and for 1-year perspective, the debt fund is also looking attractive as the industry awaiting for rate cut from RBI.''
> What services do you offer?
We offer mutual fund, insurance, direct equity, company fix deposit, various bonds and fixed deposit. We prepare financial plan for the individuals on fee based model.
> What is the AUM that you have now? How has the last two years been in terms of client acquisitions and AUM growth?
We have around 230 million AUM at present including all equity, debt and balance fund. The last two year has been very important in term of client acquisition and AUM growth. We have grown very rapid with the help of our satisfied client. As our approach is very simple to provide best and suitable product to the client and offer the best service. If you give the best advice and service to you client, the AUM would be automatically grown.
> How would you differentiate your services from that of competitors? Do you think there is enough potential in this wealth management market to sustain as many players?
First, we analyse client's need and asses their risk tolerance level. After that we suggest them to the investment avenue to achieve their future financial goal. We offer advice to the clients without any bias and provide the right and suitable investment options.
In India, there are still enough potential in wealth management market. Very few persons are offering advice with ethics and honesty. There is a lot of misspelling in the market. In the industry, there are still good demand of financial planner with honest advise. The investors are still looking for the good services and advice.
> Gold is in a bull market for ten years now. So an increasing number of people say it is in a bubble. Your comment?
In my point of view, gold has always been a hedge asset class against inflation and not a huge return generating asset class. No doubt, it has done outperform if we compare it all other asset classes. Now investor should cautious if they want investment in it for long term. They should not invest in the gold more than 20% of overall asset allocation.
> How do you believe the overall global investment environment in this year is going to look like? Your advice to retail investors?
At present overall global environment is not very positive. US is facing fiscal cliff and Europe is also facing the problem. I hope the situation would be improve gradually this year. In domestic front, government has already shown determination for economic reforms. The result of companies is also good indication for future growth.
Retail investor should continue their SIP in equity funds as the next 2-3 years would be prove return generating and for one year perspective, the debt fund is also looking attractive as the industry awaiting for rate cut from RBI.
> In India, when it comes to wealth management and financial planning, people do lack initiatives. Why is it taking long for these concepts to gain popularity in India? How long will it take for these concepts to pick up momentum?
If we talk about today's youth, they are interested in wealth management and financial planning. But the real problem is there is no awareness about the benefit of all these things. Industry has huge shortage of good planner and advisor. Bad past experience of wrong selling of product by so called advisor and planner is also the cause of slow growth of this industry.
But gradually the scene has been changed and if we can spread the benefit of wealth management and financial planning then it will grow faster. I still believe there is huge growth potential in this industry. Next 2-3 year we will see good growth as these concepts has already started to pick up the momentum. The only requirement is good professional advisor.
> What, according to you, is the process of wealth management?
The goal of wealth management and financial planning is to fulfill the future goal through right mix of investment and proper asset allocation. Here, right mix investment means to invest your money between equity and debt according to the person's need, investment horizon and risk taking capacity. It would not the same for all persons. So there are different asset allocation and investment avenue according to the individual's need.
In wealth management process, first we should finalise the individual's need and future goal. After this make a simple financial plan to achieve future goals and advise right products. Review the investment and financial goal time to time and change the asset allocation accordingly. The ultimate goal of all these exercise that the client should meet all future financial goal through wealth management and financial planning.