Surat-based Amit Thakkar started his career as a CA at 21 years of age. Most of clients sought his advice to save tax. While researching options (80C investments) he discovered that ELSS has an edge over other tax savings instruments as it can generate attractive returns over long term.
In 2004-05, Amit pursued CFP to increase his knowledge on mutual funds and financial advisory. He then shifted his entire focus to financial planning. He realised that mutual fund products are transparent, save costs and are the most convenient vehicle to invest in the market for retail investors. He believes mutual funds are the only financial products that can help investors achieve financial goals. Today, Amit manages assets under advisory of Rs.170 crore in mutual funds with over 1500 clients.
Client acquisition
Referrals and investor awareness programs have helped Amit acquire new clients.
Referrals: Amit says that he mostly gains new clients through referrals. He believes that word of mouth is an effective way to grow client base. “I never ask for referrals. My clients refer their friends and family members as they are satisfied with my services,” says Amit.
Investor awareness programs: Amit conducts investor awareness programs quarterly where he invites guest speakers. He says that inviting expert speakers ensures better participation from the audience. “Not everyone is an orator. It's nice to have expert speakers as they can give insights and key takeaways to the audience. The audience will surely come to you for advice once they understand the benefits of mutual funds.”
Amit does interesting sessions for prospects with topics such as ‘Logic vs. Emotion’. Such topics generate a good footfall & generates leads as people approach him for investment advice. They also requested him to conduct these programs regularly.
Every client is important: Amit is of the opinion that catering to low ticket size can help advisors grow business gradually. Sharing an incident with Cafemutual, he says, “A liftman of one of my clients' building approached me for financial advice. Initially, he was hesitant to discuss his finances. I made him comfortable by telling that he can start investing in mutual funds through SIP with Rs.500. This man not only invested with me, but he also referred his friends and family members.”
As a financial advisor, Amit believes that his financial knowledge can help many people who earn daily wages. For him, it is more satisfying when he gets a SIP of Rs.500 or Rs.1000 from these people. His primary belief is small is beautiful and more meaningful.
On boarding clients
Face-to-face interaction: Amit says that having a face-to-face interaction with his clients helps him understand needs and goals of his clients and establish a healthy relationship with them. He believes that staying in touch with clients regularly helps advisors retain clients. “I prefer face-to-face meeting over a telephonic or Skype call. Even if a client wants to meet twice a week, I am open to it. Physical interaction with clients ensures that you will get to see his expressions and make out if he is happy or anxious about something.”
Shift from equities to MF: Amit says most people in Surat invest directly in equity. “These clients want to 
make a quick buck. However, I encourage them to stay put for the long term through mutual funds to create wealth. I highlight how a mutual fund is safer than direct equity and show them performance charts of various schemes across different market cycles. A few clients may not invest with you, but most of them come onboard. Once convinced, these clients invest for long term. “
Amit believes comparison charts such as large cap stocks vs. large cap equity funds can make your prospects understand the benefits of investing in mutual funds. Many large-cap schemes have outperformed the benchmark, which a particular stock may or may not, he adds.
Identify goals: Amit helps his client identify financial goals before investing money. He believes clients invest for long term once they link their financial goals with mutual funds.
Conviction in equity
Amit has a belief in equity funds. In fact, 95% of his assets under advisory is in equity funds. He believes equity funds are the only investment instruments that can beat inflation consistently and help people get wealthy in the long term.
According to him, equity as an asset class is under owned in investor’s portfolio. “Most people have adequate debt exposure through their fixed deposits, post office savings scheme, PPF and insurance products. Also, many people have investments in gold and real estate. However, many people don’t even know about equities,” observes Amit.
Amit never recommends open-ended debt funds to his clients; instead, he advises them to go for FMPs or FDs for short-term investments. He says that people hold this myth that debt funds are risk-free. To bust this myth, he explains to them credit risks and duration risks associated with debt funds. He also informs them that bank FDs might not beat inflation over a long term.
Fund selection
Before recommending any scheme, Amit first understands the needs and goals of clients, their temperament and time horizon. He believes that advisors should first understand their clients before jumping to product selection. It helps in assessing risk appetite and suggesting a good mix of products, he says.
Then he goes by the returns that the fund has generated in the last five years and scrutinizes the fact sheets of the schemes to understand the quality of the portfolio.
Amit is not shy of suggesting sectoral funds to his clients who can handle more risk. He believes that investors who have high-risk appetite must look to invest in sectoral funds as they can generate higher returns than diversified equity funds.
Managing expectations in difficult time
Since Amit is in the financial advisory business for 12 years, we asked him how he manages expectations of his clients during difficult times.
Amit says that it is hard to say how clients will react when the market is going through turbulent times. He believes that it is the responsibility of financial advisor to make them realise that market volatility is
a part of equity investments. During tough times, he encourages his clients to continue with their SIPs as it can help them ride out market volatility and achieve financial goals. He highlights SIP returns chart to make his client understand the benefits of rupee cost averaging.
However, in his experience, investors have become mature. “Earlier, investors used to press the panic button whenever market took a downturn but now they take advantage of the dip to increase their exposure to equity.”
Future plans
Amit plans to diversify his business in other cities such as Mumbai, Vadodara, Bangalore and Ahmedabad to grow his business.
Amit is a role model for advisors who want to grow client base and equity AUM through retail clients. His willingness to serve low-ticket investors and nudge direct equity investors to invest in mutual funds sets him apart from the crowd.
