Mutual Fund Advisor

Nitin Agrawal
Nitin Agrawal
nitin@orowealth.com
mutual fund advisor

You must have received numerous calls from people or companies trying to recommend some mutual funds. Have you ever wondered who these people are? Are they authorized to recommend funds? Is their recommendation trustworthy?

Off late, mutual funds have become a favorite investment instrument. All thanks to the market regulator Securities and Exchange Board of India (SEBI) that intervened in the market to ensure proper guidelines are laid and investors’ interest is preserved.

Now, people are moving away from physical assets to financial assets and are looking for diversification. Investors are looking for instruments that are liquid and offer higher returns at a relatively lower risk. Also, they are looking for expert management with a high degree of government regulation. All these sound ideal, but at the same time, it also requires a certain level of awareness on the investors’ side. An investor should know their risk tolerance and should be able to plan for their accomplishing goals. This situation is precisely where a mutual fund advisor can be useful.

Who are mutual fund advisors?

Mutual fund advisors are qualified professionals who understand the nuances of a mutual fund.

What does a mutual fund advisor do?

The job of a fund advisor is to figure out the fund that matches the investor’s interest and align with their objective and risk tolerance.

So, can everyone become an advisor?

Well, it’s not so simple. As we mentioned, all thanks to SEBI for preserving investors’ interest, it is mandatory for a person to have a valid certification from the National Institute of Securities Market (NISM). The examination is “NISM Series V-A: Mutual Fund Distributors Certification Examination.” Once an individual clears the exam, he is issued an AMFI Registration Number (ARN) by Association of Mutual Funds in India (AMFI).

What are the roles of mutual fund advisor?

An advisor should be patient and should hear out client’s investment goals and needs. It is the ethical responsibility of the mutual fund advisor to disclose every detail of an investor.

Following are some of the critical role of an investor –

• Educating the investor

First and foremost duty is to teach investor about the investment plan that can help them achieve their goal. This includes exploring all the investment options and club multiple to generate maximum returns at a given degree of risk.

• Evaluating risk tolerance

An advisor should suggest the fund that aligns with the risk appetite of the investor. For example, an equity fund should not be recommended to a senior citizen who is in his 70s and looking to invest for 2-4 years.

• Analyzing investment options and devising a strategy

One of the most critical jobs is to examine all the investment options at hand by taking into consideration the latest economic development and financial development. Also, an advisor should devise a proper strategy by taking into account the investment horizon, risk appetite and goal of the investor. An advisor should ensure that the portfolio delivers maximum returns at a given degree of risk.

• Helping diversify a portfolio

Never put all your money into one instrument. An advisor should always help their client to diversify their portfolio so that the risk can be spread.

How can you select a fund advisor?

Simple words – one should select an advisor based on the experience. Typically someone who has good experience in the industry or follows a well-defined and set approach in investment selection is considered to be a good advisor. This also means that the advisor is accountable for any statement or suggestion offered and has to adhere to the Code of Conduct for Intermediaries of Mutual Funds that AMFI & SEBI mandates over time.

If at any point you feel that a fund advisor is rushing you into a decision he is not the one for you.

Top Mutual Fund Advisors

There are plenty of them. But in today’s era where technology is becoming the backbone, you should look out for something where the technology is used rightly for financial advice. With the help of technology, you can get right from a diaper to a house in a couple of clicks with ease and with the right information. You need to scout for an advisor that follows a similar approach.

One fund advisor that has been reshaping the financial services industry is Orowealth – have a check.

Conclusion

To conclude, a competent fund advisor is one who can make a difference owing to their experience and competency. Remember there is a difference between distributor and advisor. While an advisor can pick a fund and advise you, a distributor only distributes funds.

Nitin Agrawal
Nitin Agrawal
nitin@orowealth.com

Nitin is the Co-founder and CEO at Orowealth and has worked at Deutsche Bank for 6 years in Equity Structuring across their London and Singapore offices. He is a MBA from IIM Bangalore and has a degree in Electrical Engineering from IIT Bombay.

5 Comments
  • Avatar
    Alexdom A
    Posted at 13:44h, 27 March Reply

    Thanks for this blog… Mutual fund is the best choice to invest money. Nowadays, many people start to invest in mutual fund. If you don’t aware of it, you could have word with financial consultant.
    how to invest in mutual funds
    Financial advisor in Chennai

  • Avatar
    Bhushan Waghulde
    Posted at 15:12h, 27 March Reply

    Well done

  • Avatar
    Bhushan Waghulde
    Posted at 15:13h, 27 March Reply

    Well done..orro

  • Avatar
    BABUL KADER
    Posted at 15:52h, 27 March Reply

    Can I invest in mutual fund by SIP as well as lumsum in the same category of MF of two different AMC ?
    E.g..SIP in Axis mid Cap fund direct(G) 3000/month and also lumsum in HDFC mid Cap opportunities fund direct (G) as both are of Mid cap category.
    Please explain advantage & disadvantage.
    Thank u

  • Avatar
    Alexdom A
    Posted at 12:06h, 04 April Reply

    Choosing the best mutual fund can help you to make more money that will help you to contribute with your financial plans. And the advantage of the mutual fund can invest with a small amount.
    how to invest in mutual funds
    Best Financial Planners in India
    Best financial advisors in Chennai

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