Podcast 13th May 2016
Hi I am Arjun Parthasarathy speaking and this podcast is on “When you get “Sold” Investments, rest assured you will regret it later”
The first question we ask our subscribers when they give us their portfolios for restructuring and rebalancing is “what was the rational behind your investment decision?” Almost invariably the answer is “I was sold these investments by brokers, distributors, agents, wealth managers and other such financial service providers”. The portfolios are usually unstructured, have no thought process behind them and do not in any way lead to the financial goals of the subscriber.
At the risk of not sounding modest, most of our subscribers who come to us realise that their portfolios require restructuring and also want to understand what goes into the investment process as it can mean a huge leap towards achieving their financial goals. We always explain to our subscribers the reason for the way their portfolio is being constructed or restructured and also provide them the necessary tools to understand the investment process through our e learning platforms.
Coming back to the point of investment being “Sold” to you rather than being “Bought” by you. What makes you take the easier way out on your investments, which is getting “Sold” investments? Buying investments require some work on your part and you need to exercise your brain by first understanding investments and then structuring your portfolio to meet your financial goals. Most investors as per behavioural economics findings do not want to work the brain and end up getting “Sold” investments.
The financial services industry is highly competitive and to gain business the industry has to catch your attention. Right from “multi bagger” smses to calls on mobiles, you are inundated with sales and marketing pitches for investments. While this hard sell marketing does create awareness, it also leads to investments that most of the times do not work in your favour. Hence it is really up to you to ignore the sales pitches and make investments that will benefit you the most.
When you “Buy” investments, you know exactly the reason you are buying the investment. The reason could be fundamentally flawed but then you can always rectify the flaw and make sure that your next investment is fundamentally sound. Many times you will find that your reason for an investment is much sounder than what professionals tell you.
The next time when you make an investment, think whether you are being “Sold” the investment or whether you are “Buying” the investment.
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