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Its evident that large AMCs have taken IFAs for granted. Its not question of money but Trust. It looks like certain AMCs have decided to break the trust. May be these AMCs think that they can earn more profit but charging 1.80% TER to investor and pay 10 bps to distributors. This is good margin to increase the profitability of AMC. They also induced advance upfront and now they are clawing back creating credit notes which is difficult to understand. Is AMC is indirectly pushing distributors to churn which is dangerous. It is not good to leave a feeling of betrayal. Greed of more profit is breaking the TRUST. Be logical and be reasonable. Trust deficit is dangerous. AMC assets are built with hard work of advisors and also retained by them by hand holding investors in tough times (both in bear market and bull market).
Buffetts principles are the foundation of our industry. The first one is integrity, which was tested this time and the arrogant large /medium sized AMCs miserably failed due to the short sightedness of their greedy management. These AMCs are going to lose old assets as well as new assets to the saner competition.
A Zeus / krishna situation here
