Opportunities in Wealth Management By Naresh Pachisia Managing

Opportunities in Wealth Management By Naresh Pachisia Managing Director SKP Securities Ltd

Emerging Opportunities in Wealth Management • High economic growth rate • High capital creation by SMEs, HNIs • High savings • High investments • Low tax rates, means low emphasis on tax savings • Exit of Govt subsidised, tax saving/fixed income securities • Emergence of large number of dynamic investment instruments across asset classes viz. Equity Funds, Debt Funds, Insurance, PE Funds, Real Estate Funds, REITs, Gold ETFs, etc. • Very low penetration of these investment instruments • Lack of financial literacy & wealth management prowess • Lack of investor discipline, disillusionment

Paradigm Shift in wealth management • Its no more about savings, its about investments • Its no more about being tax efficient creation, preservation or transfer of wealth, its about all combined • Its not just about tax savings; because you cannot do much about it and with low tax rates, its not required much • Its about understanding that business capital and family wealth are two different things • Its about having a need based, goal or objective oriented, strategic wealth management, based on your risk profile • Its about proper asset allocation and dynamic asset reallocation to achieve your goals, as per your risk profile • Its more about asset allocation from several asset classes and less about in which stock or fund to invest

Paradigm Shift in wealth management • Its more about insurance as an instrument of protection than as an instrument of investment or tax savings. • Its no more about taking more or less risk; its about optimising returns and risks using time horizon as an essential ingredient in investment decision making • Its less about intuitions, its more about research and knowledge of various products, their features and benefits and matching them with investor needs • Its about not falling prey to the common investor psychological cycle of greed and panic; its about winning over this cycle • Its no more about having a complicated, rash or hearsay style of investing; its about having a simple and disciplined approach to managing wealth

An opportunity for Company Secretaries in wealth/treasury management • CS is a profession of discipline – to bring discipline to companies and their promoters/management, entrusted with responsibilities like corporate governance • CS – employed or practicing - are most well placed to induce discipline and governance into investing ways of companies and their promoters/management. • Practicing CS have a phenomenal network of clients with an aura of trustworthiness around them – very much required to grow a wealth management practice • Erstwhile tax practitioners/CAs have not been able to change themselves with the changing paradigm in wealth management. • This leaves CS with an exciting opportunity to fill this void by entering wealth management. • An opportunity to make yourself more meaningful

How can you do so? • If you are employed, simply guide and influence the promoters /management about the need for having a fresh look at wealth/treasury management as a goal based, strategy oriented concept, rather than being transaction oriented • Avoid product pushing service providers who are interested in pocketing commissions and offer commissions as a bate; instead adopt comprehensive service providers who take accountability for their performance in overall wealth/treasury management • Or, YOU be the wealth/treasury manager • If you are practicing CS, add value to your career by becoming an Independent Financial Advisor, leveraging your network • You can be completely on your own or get associated with a wealth advisory platform like SKP. From client sourcing to managing their wealth/treasury, you add value to your clients as much as you can, focussing on your core competency, outsource the rest to the likes of SKP • Obtain a CFP Certification from FPSB, India

Conclusion • There are huge opportunities emerging in wealth management • A paradigm shift is taking place in wealth management • There is an opportunity for CS in wealth/treasury management • Employee or Practicing – do what you can do best i. e. acquire and manage your clients, outsource the rest to the likes of SKP

Thank You Naresh Pachisia Managing Director SKP Securities Ltd naresh. pachisia@skpmoneywise. com www. skpmoneywise. com