It is not easy being a financial planner, broker, adviser or even a blogger. As a blogger there is less ‘accountability’ towards a reader, and anyway no fees to be earned or lost, but let me give you some examples.

1. Subra Facebook is a great issue: When the FB issue hit the market 4 friends who had money in the US wanted to apply for the IPO. No amount of saying that an IPO is for the institutional investor, employees, and promoters to get an exit, they were all tempted. One is a good friend who said ‘fine, will not invest’. However the other 3 did apply and I have no clue whether they are happy or sad. Of course today they could rationalize and say ‘anyway it is only Rs. 500,000 or something like that.

2. Riskier portfolios get higher return – OMG no. NO. NO. When a person gets a higher return than say the index, we KNOW that the client had taken higher risk. However every time u take a high risk, it does not mean that YOU will get higher returns.

3. A few of my friends bought RE in the USA and have sold when they got 20% return in less than a year. However not everybody knows how to play the RE market in combination with the currency market. Most of these friends are regular travelers, have a place or residence in the US, and are familiar with the market. One is a builder based in Mumbai – and has a fantastic market assessment skills. I NEED TO HOLD THE HANDS OF OTHER friends and clients stopping them from dealing in foreign markets without a lawyer or a CA.

4. I understand the risk that I am taking in buying this junk bond. Amazing over confidence.

5. “My friends are all buying a plot of land near Mumbai, it is payable in installments and the promoter is a God fearing person.” When you are ‘told’ this, you just wish them luck, right?

In all such cases trying to talk the person out of deals which they do not comprehend is not easy. Also very very sadly in the BFSI space you get paid ONLY for consummated deals. So if I stop a client from investing in one of the above deals, I do not get rewarded. I have to IMMEDIATELY move that money into one of my products which will of course save the client but also make me MONEY. Here greed steps in. Alas.

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