Wealth management - Private bankers/relationship managers
I am tired of selling financial products that are not investor centric, as a RM I am forced to sell products with higher commission and most often good products have lower commission.
No product I sell would I buy for my own self. Now I feel what I am doing is wrong and will not help long term.
The HNI client will eventually know and I will loose my credibility and AUM.
There are hardly any wealth management outfits that work for the clients. It is very unfortunate.
Anybody else feels the same?
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Hey @Whoiswho
Firstly thanks for sharing this
I am currently in the process of getting a wealth manager
I am curious, what kind of org do you currently work at? Is it a bank or one of the wealth management companies like Motilal Oswal/Anand Rathi?
Is this mainly driven by the incentive structures? (Mutual Fund pays to Wealth Manager, and hence wealth manager recommends whatever is highest incentives?)
If one compares then this can be found less at private wealth management firms and more at banks.
Mutual funds have a cap on commissions and is much lesser than 1%. Banks try to push other products where commissions are higher.
If the advisor (distributor) commission is 3% then if you are investing 100rs only 97rs gets invested. If you think deep, higher commissions are given in products that are usually not fast moving. Majority of times, such products usually have larger commissions and lower growth potential.
Mutual funds with low expense ratios are recommended.
There are many RMs who work for the clients and have ultra HNI relationships with promoters of listed entities+ which they have cultivated for years to decades. If you can absorb the pressure short term and bring in revenue not from the high incentive products(which due to new rulings are not a lot remaining anyways), but from larger AUMs in good products where the investors make money, you will make a great career. Not all pure play Private Banking units are like bank branches and if you do well for the clients you will be able to carry them along to your next firm with you. Many in this industry have done the same and have made great careers out of it. Its not as easy as it sounds above but worth it in the long run.
Agree with you. The problem is when you are employed then you are obliged to sell what you are told to sell. Over a period of time when you sell the wrong products you eventually loose a client, because the face that sold the product is you
Any other wealth managers/RMs here?