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What are the key investor trends you've noticed in 2024?
In 2024, there has been a noticeable shift as investors increasingly move towards sophisticated equity products such as PMS and AIFs. Investors are also becoming more comfortable with technology and digitalisation as tools for making investments.
One interesting trend is understanding of volatility as a concept has gone up among investors. Now, people invest money whenever there is a small correction in the market.
On the flip side, one concerning trend is the growing expectation of very high returns, driven by a focus on the past two years’ performance, which can lead to unrealistic expectations.
What skills will be essential for MFDs in 2025?
Here are some key skills MFDs will have to develop:
- Adaptability to both evolving technology and changes in market trends
- Research-driven insights to create a competitive edge and add value to clients
- Regular meetings to ensure clients’ needs are always met
- Building a proactive team to service clients evolving needs
- Effective branding that aligns with your vision statement and clearly communicates your values to clients
The last few years have been good for the distribution community, largely due to market conditions. How can distributors sustain this growth and maintain momentum?
While we don’t have control over market outcomes, sustaining growth requires a strategic approach:
- Acquire new clients through activities like investor awareness session and digital marketing
- Promote SIPs and STPs, which have been effective in building long-term investment habits irrespective of market conditions
- Strengthen existing client relationships by using AI and effective CRM systems to deliver personalised services
- Engage the next generation of investors to ensure long-term partnerships
Direct plan platforms have gained significant traction, with direct plans now accounting for 40% of SIP accounts. How are you staying relevant to investors?
Direct plans allow investors to make decisions on their own but if they lack expertise or time or if market conditions become volatile, they may make poor choices. As MFDs, we offer alternatives by providing:
- A robust investment process that guides decision-making
- Comprehensive research and knowledge throughout the investment journey
- A transparent and ethical approach that fosters trust
- User-friendly website for a seamless experience
- Regular guidance and reviews to ensure clients stay on track with their goals
Adding women investors is a priority for the industry. How are you approaching the acquisition of women clients?
We are very focused on this. Recently, we hosted an event at a girls' school, engaging with female teachers to help increase financial literacy. We also actively encourage couples to participate in financial planning sessions, ensuring that women are more involved in their family’s financial decisions. Our goal is to make financial planning more inclusive and accessible to women.
Which investor segment do you believe is underserved and holds potential for growth?
In India, the rural segment and low-income groups are often overlooked. These segments need guidance and support the most. I’ve attempted to reach out to them through my media columns but I acknowledge that I haven’t been able to fully assist them as much as I would like.
What technologies are you looking to implement in the coming year?
I'm particularly keen to leverage AI to analyse data more effectively, derive insights and improve decision-making processes. AI has the potential to greatly enhance both client service and the investment process as we move forward.