In Finance there are more than one sub sections under one word, like Banking finance, corporate finance, Accountancy, Investment finance and so on.
Since the beginning of my professional finance course at PG class, I was passionate to choose Investment finance over other finance fields. It is not only about numbers and profits; it’s beyond numbers - more I dig in more treasure I earn.
The most difficult hurdles in investment profession are NOT technical knowledge, or valuations, or inflation & tax adjusted returns from particular instruments. The most difficult hurdle for an investment advisor is, How to convert her understanding about financial markets and related products into very simple language so that client can understand about her next investment move.
In today’s investment market I have seen, investment advisors are not very much trustworthy for only one reason. And the reason is that they have failed to communicate with their existing or prospectus clients in layman language.
How can a professional advisor expect, a client having three to four timber factories would understand that when the interest rate goes up and market finds hard times in liquidity positions, ultra liquid funds are going to fall – which could be used for working capital etc. Or how can a professional advisor expect, a retired school teacher would understand that falling rupee is good sign to add export oriented funds into a portfolio – which could be used as monthly income from high dividends.
I sincerely believe that if we as professionals would not adapt new ways – especially creative ways to make our clients understand what they are investing in and why it is important. We need to remove technical jargons and fancy talks covered with finance phrases.
I tried to come up with a story in my blog [Why my batchmate should know this money management secret?] and tried to explain retirement concept of Personal Finance. In one of my other blog [India needs second wind phenomena] I tried to explain inflation and debt issues with my personal experience examples.
Talk to your client in its language. Put it very straight and simple.
And above all, it’s time to use our right brain. Investment is an Art.