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Learnings over the years on markets and dealing with markets
The nature of the market is that it is and will remain volatile over short periods. If we string these short periods together the volatility reduces. We also see from evidence that returns improve. We have learnt the concept of probability in school. If the chance of success (returns) each time you select a stock is 80% (and hence failure is 20%), if you make the selection twice, the probability of success drops to 64%. So unless you have a 100% chance (that's no longer a chance) of success, reducing the number of transactions increases your probability of success. That's how you deal with markets; but dealing with investors is another matter altogether.
Learnings over the years on understanding clients and their evolving needs and aspirations
You have to, repeat have to, spend enough time understanding clients before on-boarding them; and also allow them to spend enough time before selecting you. That allows to set expectations clearly and also increases familiarity and comfort. This in turn allows clients to raise difficult questions with you. Doing this allows for deeper conversations as their evolving needs and aspirations are being experienced by them for the first time too. Basic rules such as being brutally honest, acting in their interest (only) and keeping yourself upto date with products and solutions will ensure your clients believe you, are comfortable with you and thrive with you.
Learnings over the years on dealing with regulatory change in the profession p>
There are two sides to every coin and every role has a contra role. One side makes rules, the other has to follow. What is not in my control does not bother me -- so I try to predict the way the rules may change. Attending international conferences opens your eyes to the changes that are taking place across the globe and makes you more sensitive to the changes happening here. Don't stop there -- go beyond sounding passive and being a willing victim -- participate in groups such as FIFA which are not reactive, take thought through decisions and are in a position to influence change. With my experience with FIFA, I know now that it is not a Mumbai based organisation; it is not focussed only on large distributors -- there is a realisation that there are many areas where I am not an expert and can learn from others. Influencing change will not happen through protests but constructive dialogue: you may not succeed at first but you have to chip away.
Learnings about a changing competitive landscape and evolution of your business model
I am so fortunate to have been in this industry during the period where it is continuously evolving (almost feels like it's revolving :-) ). It allows me to use my grey matter else a robot can replace me. We have to accept that wealth is a new phenomenon in India; understanding wealth is newer; managing wealth is even more recent. That allows me to accept that we have to set the path; not follow one -- so we can't look to others to figure out business models in India. The client is at the centre of your business -- he's the "why" for your business and that cannot change. There may be some similar and some not-so-similar situations that my friends in the field of financial planning and advisory may have faced in other countries. I have to be able to distill the learnings from another environment and another time to see what applies to my business. In financial advisory more so than any other business your evaluation needs to be in rolling three to five year cycles rather than annual numbers. Your decisions to invest in people (and their continuing education & knowledge gathering) and technology which are essential for your existence and then growth are taken so much more rationally.
Content is prepared by Wealth Forum and should not be construed as an opinion of HDFC Mutual Fund.
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