With the recent rise of social media influencers and self-proclaimed investment gurus, the lines between informed financial advice and reckless speculation have become increasingly blurred. Many individuals are now dispensing investment advice without proper training, expertise, or understanding of financial markets. Unfortunately, this has led to an alarming increase in investment scams and fraudulent schemes, leaving many unsuspecting investors vulnerable to financial ruin.

In this context, it is important to understand the benefit of engaging with SEBI registered investment advisor in today’s complex financial landscape. A reliable investment advisor can help you navigate the ever-changing investment setup and provide a personalized strategy tailored to your needs and goals. They can also help you avoid pitfalls like emotional decision-making, market volatility, and investment scams.

7 Reasons To Partner With A SEBI Registered Investment Advisor

1. Lets You Know Your Risk Appetite

The first and foremost step that every certified investment advisor takes is to know about the client’s risk appetite. A risk appetite analysis helps you know the amount of risk you can take in the market. Investing comes with its own set of risks. No investment can be considered as cent percent risk-free. It is better to be prepared for the worst; a risk profile helps you know the same.

To calculate your risk appetite, your investment advisor considers several parameters, including your income, assets, liabilities, dependent on family, age, etc. All these parameters help in knowing your risk appetite, based on which the investment advisor helps you embark on your investment journey.

2. Investment Planning

The very obvious role of an investment advisor is to plan the perfect investment for you. The investment world has many offerings of different instruments for investing your capital. An investment advisor considers your investment capital, goal, horizon, and risk appetite to choose the most apt investment instrument for you.

Without the help of an investment advisor, it becomes confusing to pick the appropriate investment instrument for your needs. For example, you need to plan for your retirement, which involves investing your capital for the long term. There are thousands of investment plans and schemes, and finalizing one is not easy. Any wrong step in the selection can severely hamper your portfolio.

3. Diversification

Diversification is one of the most important factors for being a successful investor. Diversifying your investment portfolio, i.e., investing in different segments and instruments, helps you hedge the market risks to some extent. As we discussed, the financial markets have plenty of investment opportunities, and as an investor, it is next to impossible for you to know about each of them.

The investment advisors deal with numerous clients daily, which helps them update themselves with the latest market offerings. For example, you may have an edge in investing in base metal commodities. An investment advisor will diversify your portfolio by dividing your capital across different segments such as energy, precious metals, etc. As a result, if there is a fall in any of these, the other two will recover the loss. Diversification plays a key role in investment; no one else besides your investment advisor can help you diversify your investments better.

4. Convenience

Individuals who are always worried about their investments in the financial markets must have been encountered. As a result, they keep themselves glued to financial news channels and other sources to keep themselves updated about the latest events that can impact the market. Opportunities are created in the market occasionally, but you need to be prompt and updated to make the most out of them.

With the help of an investment advisor, you need to follow the advice and place your trades accordingly. Advisors have a large network of researchers who keep track of the latest happenings worldwide and can predict market movements based on technical and fundamental analysis. Being a certified researcher requires a lot of experience and qualifications; after all, predicting market movements and providing recommendations is not easy.

5. Peace of Mind

One of the most significant benefits of partnering with a SEBI registered advisor is the peace of mind it brings. Knowing that your financial future is in the hands of a qualified professional dedicated to helping you achieve your goals can relieve the stress and uncertainty of managing your finances independently.

6. Goal-Oriented Investment Strategies

A key advantage of working with a SEBI-registered investment advisor is their ability to develop goal-oriented investment strategies. Whether you’re saving for retirement, buying a home, or planning your child’s education, they will design a portfolio that aligns with your specific objectives, helping you achieve them more efficiently.

7. The Entry and Exit Game

It would help if you switched between investment instruments and strategies to make the most out of your investments. But choosing the perfect time for entering a particular position and exiting from it at the right moment is not easy. A bearish market will not always stay bearish, and it is important to exit from it before the bear begins to dominate.

Timely entry and exits are the key factors for extracting the maximum profits from your investments without incurring losses. But for an investor, it is impossible to time the markets. An investment advisor helps you set a target and stop losses to maximize profit and limit losses.

Having an investment advisor can thus be a boon in your investment journey. However, before choosing an investment advisor, it is very important to check whether the advisor is registered with SEBI. SEBI acts as a watchdog for all investment advisors. It is thus important for an investment advisor to be registered with SEBI, as they indirectly manage your capital and finances. If you feel that there has been a glitch from your advisor’s end, you can approach SCORES, which is SEBI’s complaint and redressal system.

There are many benefits of having a SEBI-registered investment advisor. So, having an investment advisor like Fipro is worth the investment!