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2023 is coming to an end soon, what are the key business lessons that the year taught?
Our Indian investors have given us a big lesson this year; they have stayed away from the entire noise and adopted simple and effective solutions like SIP which is evident from strong SIP flows in the industry despite many geo-political events, period of FII outflows, period of market drawdowns etc.
As an industry, we are too obsessed with short-term performances and star fund managers. However, some key lessons should be to focus on our dharma by focussing on providing right solutions, adopting right risk & investment process, simplifying our communication.
What are the key trends that MFDs/RIAs should watch out for in 2024?
This will be the decade of the MF industry and key trends next year from industry perspective will be the movement of much higher allocation in MF from household savings. Financialization of savings is catching with growth in MF folios, flows and AUM and this trend will become much stronger next year and in the coming years. Within the MF space, I expect much higher flows in hybrid strategies in the coming time. Another key opportunity is higher adoption of 3 S strategies of SIP, STP, SWP by investors to meet various financial needs/ goals- while SIP is gaining traction, other 2 strategies of STP and SWP need much higher efforts at the industry level to bring awareness among investors.
What are the three must-have business skills for MFDs/RIAs in the coming year? And why?
We are in Amritkaal Period - in the next few years, we will witness massive growth in the country and our business will witness lifetime growth opportunity. Amritkaal investors are getting much more informed and their expectations are also evolving. For our partners to become future ready, I believe they must:
- First - Invest in Business - Technology, People, Process.
- Strengthen the communication with investors through various phygital mode incorporating both physical meetings for update and also explore using digital mode of email, blogs etc. for regular communication.
- Reimagine the business objectives by incorporating elements like - new investors, asset mix, focus on growing unit capital (instead of AUM only)
