In an interview with Yogita Khatri of myiris.com, Abhinav Angirish, managing director (MD) of Abchlor Investment Advisors, says, ``Gold is the best form of investment to beat inflation. An investor must have at least 12-15% of investments in gold at all times.``
> What has been the kind of growth in your business over the last few years? Please tell us about your current business model, the kind of clients, AUM etc.
We started business in the year 2004 with a team of 4 members and today spread to 40. Our business model has always been sound investment advice thru asset allocation and financial planning. Our services initially for a year were restricted to mutual funds. In the subsequent years we added equity broking, equity advisory, life insurance plans, general insurance, home loans, loans against securities and properties and lately we have also started real estate investments and private equity advisory services. We are a one stop shop for all investment and financial needs. Earlier, we served HNIs, corporates and NRIs. Since the last three years, we have expanded to the retail side as well by providing an online portal to invest in mutual funds online. A unique mode of investment in MFs. Registrations and transaction charges are free and one can invest as low as Rs 1,000 to start with. Being the pioneer of online investments, we have understood the needs of retail investors and have provided various tools and facilities to our online portal. We are continuously adding many such tools to enhance investment experience. We believe this model will go a long way in terms of reach to various categories and genres of investors. Yet, our core model has not changed. Though, the website is `Do-it-yourself` model, we do try to educate our clients to choose the best scheme that would suit their profile.
With the strong use of technology, ethical business values, professional and experienced team, we currently manage about Rs 15 billion in assets across all our products and all clientele. On an average, we have grown over 35% YOY since inception. Even in tough years like 08-09, we recorded a growth of 36%.
> Given the spiraling inflation, rising interest rates, what would be your advice to a retail investor?
Economic conditions are situations which not only retail but all investors have to manage at all times. A professional advisor does consider unforeseen and unexpected situations while deriving a financial plan for their investors. In today`s situation, inflation is surely a concern. The key to a successful portfolio is regular investments and review of financial plan frequently i.e.: at least once in 6 months. This ensures that you are following your goals and if not, it can be timely corrected. Gold is the best form of investment to beat inflation. An investor must have at least 12-15% of investments in gold at all times. Today gold is available in such attractive forms like ETFs, gold funds etc. that an investor can invest as low as Rs 100 and even forget worrying about the storage as demat takes care of it. Gold is also a speculative commodity which can make it volatile but regular investments can reduce the risk of volatility to quite an extent. It is definitely difficult to keep up for a retail investor who has to pay up for home loans, regular expenses etc without the consistent rise in pay as inflation but does it also work the reverse way? At the same time last year, interest rates were at the bottom. Did the same investor think of accumulating the interest saved on lower interest payments? Basically, it all boils down to your financial plan. If you stick by it, you will surely ride over these situations comfortably.
> How does one go about structuring investment portfolios?
First things first. Make a sheet listing all your goals, expenses etc, on one side. On the other side, list your earnings and reasonable growth expected in the same over a period of time till such goals, expenses are met. One must also consider inflation and unexpected expenses or emergencies etc.
Once the above is chalked out, try to assess your risk profile and choose the products to invest based on risk profile. It is best to consider a seasoned financial advisor who can guide you on the same. Treat financial advisors like financial doctors and just the way a patient would disclose the medical conditions to a doctor; he should disclose the financial condition similarly to the financial advisor for correct advice.
> What are the key issues that you think needed to be resolved to enable investors to become more profitable?
# Understand each and every investment made and all risks/rewards associated with it. You should not be in shock or denial ever.
# Never go by your friend`s judgment or his investments. Remember, each individual has different goals and risk profiles.
# Do not follow rumors and get carried away. Research your investment decision.
# Ask questions to your advisor till you are satisfied. If not satisfied, refrain from investing till thoroughly convinced.
# Stick to your financial plan and do review it regularly. Do not hesitate to pay a professional a fee if need be. It will only help. Don`t be penny wise pound foolish.
# Don`t get tempted by high returns of the past. Past performance may or may not sustain in future.
> What are the key areas where advisors need to improve themselves in order to serve their clients better?
# Believe in investor education.
# Think about the client`s returns and not about your revenue alone.
# Advise and suggest financial plans to investors of all ages and net worth. Learn to stick by it and suggest the same.
# Do not sell products that you do not understand.
# Strictly follow the rules set down by the administrator.
# Don`t treat technology as a threat, use it to grow your business and services to clients.
# Competition is healthy, bad mouthing will only help in the short run. Don`t sell products because your competitor is selling it.
# Treat your client`s hard earned money with utmost care. Remember, he trusts you with it.
> What is your message for young investors starting their career?
Only 1 message: Start investing NOW. Earlier you invest, earlier you can retire and lead a peaceful life. Insurance is a must as soon as you start a family or if you have any dependants.
> What are your business plans for the next three years?
We have huge plans for the next few years. We want to reach our website to many more investors. We have been investing heavily in advertising and marketing of the same. We believe that MFs are at a very initial level of growth and not too many people know about the benefits of investing in MFs and especially thru our website. We hope to have over a lakh of active investors by the end of next 3 years.
Besides, we are also looking at adding some more proprietary products for our offline clients.
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