Becoming a financial advisor isn't just about crunching numbers; it's about navigating regulations, building trust, and offering solutions that resonate with clients.
For those ready to step into this challenging but rewarding field, there are three key paths: obtaining a Mutual Fund Distributor (MFD) licence, registering as a Sebi Investment Advisor (RIA), or qualifying as a Sebi Research Analyst (RA).
Each route offers distinct opportunities and challenges, shaping your role in India's financial ecosystem. While this article outlines the key aspects, it is advisable to consult an expert before applying for a licence, as the information provided is illustrative, not exhaustive.
What's the scope of advice?
An MFD cannot provide comprehensive financial or investment advice. Their role is limited to offering 'incidental advice', a term Sebi defines as, "basic advice pertaining to investment in MF schemes limited to such schemes or products being distributed by him to his client."
They can't provide comprehensive financial or investment advice. While some MFDs may act as financial advisors, drafting financial plans or advising on various financial products requires an RIA licence.
RIAs provide holistic financial planning. From MFs to estate planning, the scope of advisory is vast. However, any advice outside the purview of Securities and Exchange Board of India (Sebi), such as tax planning, must include a disclaimer. RIAs specialize and charge fees upfront, detailing their services.
Those involved in research activities, like stock or securities selection, must consider secure RA licence. Sebi now permits RAs to create model portfolios for a fee, enabling them to curate securities baskets for clients, though execution remains the client's responsibility.
Bu hikaye Mint Mumbai dergisinin January 10, 2025 sayısından alınmıştır.
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Bu hikaye Mint Mumbai dergisinin January 10, 2025 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Giriş Yap
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