When I do advisory for customers building their own wealth – it is not my ‘knowledge’ which is helping them. It is my experience.

Not too much talent, luck or knowledge is required to pick a good equity fund or a low cost debt fund.

Even lesser skill is required to fill up the form.

So what do people need?

An ability to come to terms with their own investment styles. To know how much of risk they can take, and how much they need to take. Forget questionnaires – the maker and the person filling it do not know how to interpret this.

An ability to tell a client that a portfolio with 88% concentration is STUPID, so what if it has worked for Narayanamurthy, Azim Premji, Mukesh Ambani? At that quantum, yes, but when you have only Rs. 6 crores, a 88% concentration can kill you. Simple.

An ability to tell a client short cuts in new businesses can look good only till it comes unstuck.

Ability to tell a new businessman if he does not know sunk cost, fixed cost, variable costs, marginal costs, replacement costs, opportunity costs, hidden costs, financing cost, ….chances are he will have ONLY costs, no profits. Ever.

Ability to tell a husband ‘Your wife’s cousin may be a great friend, but he has s….d up your portfolio.

Ability to tell a wife ‘your husband has ensured that both of you will work till you die’. The retirement corpus is too small and too conservative, thus inadequate.

Ability to tell a husband ‘with a Rs. 1.5 cr net worth you CANNOT AFFORD TO STAND guarantee for your son’s MBA costing Rs. 80 lakhs in Europe – JUST BECAUSE he is your deceased wife’s son…and you will feel guilty TOWARDS HER…go get a life, dammit.


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