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MFDs Milan Patel and Sanjay Patel of Shree Hari Financial Services, Anand, Gujarat are India’s largest distributor in the individual category in terms of gross sales during FY 2024.
In fact, they received the prestigious Cafemutual Passives Award 2024 under individual MFD category.
While talking to Nishant Patnaik, Associate Editor, Cafemutual, the brothers shared their experiences of selling passives at Cafemutual Passives Conference (CPC) 2024. Here are the highlights of their session:
Conviction for passives
Milan Patel recounts how they started selling mutual funds after he left his corporate job in 2016. During their early days as MFDs, Milan and Sanjay mainly focused on selling equity funds to their clients.
The idea of passives came to them when they watched a video of the popular businessman and investor Warren Buffett who recommended index funds to investors.
Milan and Sanjay then conducted their own analysis and found that index funds have historically doubled investors’ money in every 5 years irrespective of the market cycles. Also, there is no risk of underperformance.
On top of that index funds are easy to sell and there is no need of constant monitoring.
Busting myths around index funds
Milan also talks about how many MFDs are still reluctant to sell index funds to investors due to low margins. He; however, believes that MFDs can get bigger investment cheques through passive funds.
Sharing his experience, Milan said, “When I was selling active funds, I used to get cheque of Rs.1 lakh. Now, investors give me cheque of Rs.10 lakh without asking a single question. That’s the power of passive funds.”
A message for MFDs
Milan and Sanjay recommend MFDs to start looking at passive funds to grow their business multifold. According to them, MFDs can increase their AUM and wallet share from existing clients substantially by integrating index funds and ETFs in their business.
You can watch the full session on YouTube here.