How to Choose the Right Investment Advisor?

By Advisorymandi
17-December-2019 12:04:29 PM

In a modern-day world, investing has become a need of time. Living in those traditional moulds of keeping aside the hard-earned money will merely result in a low return on its value. An investment makes for a good proposition and helps around wealth creation. But how do we go about the investment?

To take history into context, investment has always been part of our economic empowerment and has been used since the years gone by. What merely started as investing based on collateral changed into investing in the stock market, fixed deposits and more. The future holds even more investment schemes and patterns based on market trends.

There are various ways of investing and creating wealth ranging from the hassle-free and low risk fixed deposits and real estate to high-risk equity and mutual funds. Investing in equity and the stock market does require a bit of knowledge and the tolerance to high-risk high yield policy. If you look at the stats India presently has only over 2% of the population investing in the share market. That’s way below in comparison to 55% IN the USA.

As of now people still treat the stock market as a gamble or a place only where the rich people can make the money out of it. They still remain put from the investment because of the fears of losing out the hard-earned money. Couple that with the fact that the market is constantly evolving and changing, people can’t fully comprehend and understand the trend and the scale inside. This is what is closing the doors for people from investing in the stock market. In this moment of uncertainty, an investment advisor can bring their knowledge and skill to the table thus creating a scenario where common people can come forth and invest freely into the market. An investment advisor is one of the few personalities who with their skill set and knowledge can guide people into investing in the stock market with peace of mind.

Need for an Investment Advisor

Obviously, not everyone is ready to opt for an investment advisor. People love to keep track of their earnings well within their circle. But that just negates the option for unprecedented growth in wealth offered by investment. We also iterated on the point of India bearing only 2% of investors when it comes to the stock market. Couple that with the fact that there are many working professionals who want to invest in the stock market but are novices and tied down with a busy schedule, the situation is alarmingly calling for the right investment advisor.  The busy schedule for most of us doesn’t allow us to check back on the investment and the trading patterns ongoing in the market.

As we talked about, there are times when people can’t fully understand the ongoing market changes or have time to do so. We also talked about the myths and misconceptions regarding the stock market ongoing around. This is where investment advisors can play a major role around by guiding with their professional skills. Furthermore, with so many investment options around, it is pretty common that it gets confusing for a novice person. Having someone around who can guide along in our investment journey is really handful and allows us to invest in the right fields helping in wealth generation. They further help reiterate the facts and the risk associated with each investment along with the scope for growth. They help monitor and guide you along in your path for investment.

There are various ifs and buts when it comes to things like ‘how to choose the right advisor’. Taking this into consideration we here have enlisted a few concerning factors that need to be taken care of while going for an investment advisor.

 Things to Consider while choosing the Right Investment Advisor

The risk-on being on the wrong choice of the investment can be a daunting one. Interpreting the market and facilitating the right choice is of vital importance. Any carelessness or ineptness can end up costing you on your wealth. It is important to invest in the right investment advisor as it is where it all starts.

We here look at the factors you should consider while going for the right investment advisor.

Understand your financial goals

We all have different financial goals setup. Some may opt for saving for retirement plans while some may have plans to grow their wealth. Setting up goals is the first and foremost point in the path to investment. Your investment decisions are made on the basis of it and you can plan things accordingly. You may have the need for a short term quick liquidity option or you may want to hold onto the investment for a long period to see it grow and encash it for your retirement. These tendencies can only be put to use when you have a clearly defined goal in your mind. Understand your financial plans ahead and look for the investment advisors who can best fit your investment goals.

Type of advisory required

Another important factor to look into is the type of advisory that you are looking for. Based on the investment goal, you can further seek the type of advisory. If you’re having a short term investment goal where you want to maximize the profits within a short span of time, seeking an advisor who can guide you on the same would be your preferred choice. The risk levels are pretty high on short term goals as the time horizon for trading is small. This is where you may opt for hourly based advisory plans as you will need advice on a regular basis.

The right advice can help you to minimize your portfolio risk and yield maximum returns. Here advisors charge you on an hourly based fee and they can provide a total cost upfront based on the advice to be provided. If you’re on the lookout to invest in equity and hold your investments for the long haul, then it would be wise to opt for a comprehensive advisory plan.  You need an advisor who can provide a clear road-map on your investment and guide you on the right equity investment. Advisors generally charge on a flat base based on the scope of the project. The best stock advisor is someone who fits your purpose.

Check for Qualifications

As is the case with the investment options, that there are loads of them, the same is with the investment advisor. There are plenty of investment advisors around. In fact, plenty of them may have had a try at different career options before going for this one. This may bring a new dimension of knowledge and experience but there are plenty of things at stake when it comes to investing. We should look at some of these factors to decide on the qualification of the investment advisor. Read along.

  • License

SEBI (Security Exchange Board of India) is the apex authority that governs the Indian stock market. Any investment advisor is willing to serve in the same vertical needs to register with SEBI. It is one of the most basic aspects as SEBI based authorization helps you with the assurance and will also provide you with the right to raise a voice against the investment advisor if anything wrong goes by. Although only SEBI authorized Investment Advisory Company is authorized to provide any stock market tips and advisory services, there are lots of investment advisors serving in the market legally and illegally. These illegal or fraud investment advisors misguide and often put a dent to the clients’ financial status. This is why you should only trust SEBI-authorized investment advisors as they provide a mark of authenticity and also adds credibility when it comes to seeking the best investment options for you.

Always go for best SEBI registered investment advisor as they are authorized by SEBI itself to provide stock market tips, share market tips and other financial or investment tips. Also, do not fall for any investment advisor who promises to provide 100% returns or makes such promises because there is no guarantee in the market as all the returns are market-linked and above all, no one can anticipate the market trend every time.

  • Credentials

The thing about being an investment advisor is anyone with a hang of it can portray themselves as an investment advisor. But that doesn’t make them the best share market advisor. There’s a reason why credentials exist for a matter See if your prospective investment advisor has an industry designation or certification. You must have seen plenty go for certification like certified financial advisor among financial advisors and investment advisors. Confirm the training that they have received and seek assurance on the credentials.

  • Experience

Let’s put it this way, if you are to undergo surgery will you choose someone who has years of experience in the field or someone who is just fresh out of the college. The same goes for here. It’s not to discount the knowledge of the fresher but having an experienced head or trusted advisory company is pretty advantageous. Years on the belt and knowledge are what make the best investment advisors. It would be wise to let someone who is experienced take command of your financial portfolio and help you steer away to growth ahead. There are numerous investment options and ways to go about it. Someone who has been there and handled those funds beforehand would be a good pick. For say, you are more inclined towards investing in the automobile sector but the financial advisor you are talking with has been into a pharmaceutical or retail investment, so would you trust enough to put your financial faith into his hand.

Past Performance and Referrals

One thing about boasting of being the best share market advisor won’t do enough if you can’t pull out past performance that gives backing to it. Nothing gives assurance and credibility about future success like past successes. Ask the prospective advisor about references from their past clientele. Contact each of the references to find out more about it and gain the trust of the investment advisor. Also, see if he stands up for his past performance. That’s a good marker of things to come ahead. Look for top stock market advisors that have past performance showcased. These days in a world of technology, everything is online. You can check about any potential advisors’ past performance and all with just a mere click of the button. There are advisory portals that allow you to see advisor’s past performance, reviews, ratings, target hits, followers and their SEBI registered authenticity. This helps to create trust and you can side by the advisor which best suits your investment plan.

Cost for Hiring an Investment Advisor

There are plenty of things that go with the hiring of an investment advisor. The top stock market advisors come at a price. The combination of fees, commissions, and other costs can bring the package to a high cost one. This is where you need to be clear on the fees with your investment advisor. Some of the advisors charge a flat fee for their service based on a period of time whilst some opt for commission based payment. Some may also opt for the fee-based and commission-based scheme. You should choose an advisor who is transparent with their pricing and should discuss the terms pre-hand. There is no point to pay an amount that is much less than what you would get as potential profits. A good advisor will never feel reluctant to discuss the compensation and charges transparently.


Think of your medical appointment. How many times do you discuss in length about your medical issues and condition to your doctor? Whenever you have an appointment how likely are you to discuss the important aspects of your health. Investors and clients share a similar sort of connection and relation. There needs to be a bonding between the client and investment advisor, only then can the matters of finance and goals can flow. Investment advisors are there to offer you a perspective and guide you on wealth generation. But that advice won’t flow straightaway as it requires a proper understanding and opening up from both sides at first. If you don’t respect or feel comfortable around your advisor then you will leave the session with huge disappointment. The word that binds together and allows you to open up about your financial health is compatibility. It is of utter importance that your advisor has a compatible nature with you. Not all the best share market advisors can be compatible with all clients.

Accessibility and Flexibility

One of the major key aspects, when you choose the right advisor, is that they should be accessible to you. You may be looking for calls on the investment and you may need to contact your investment advisor at a timely interval. Always check the customer service aspect of the advisor as it reflects the way you will be guided towards. Look whether you can connect to your advisor at regular intervals or not. A top advisor of the share market will always be flexible and dedicated to offering you timely service at critical times so that you can make a good move in the market and maximize your chances of yielding high returns for your investment. You can connect with the advisor via online or through call also.


The trustworthiness of an investment advisor is an absolute and non-negotiable element when it comes to the stock advisory. By hiring an investment advisor you will be revealing your financial secrets and income to a third person. So do you trust the individual enough to share the information? Trust plays a vital role in this. It’s a reason why not everyone can claim to be the coveted best stock market, advisor. If there are any worries or nagging suspicions then do not proceed with the advisor. Put your concern beforehand and seek assurance on the trust factor.

Investment advisor plays a vital role in directing our wealth to more entrusted return yielding sources allowing us to generate wealth. It’s a reason why we need to find the right advisor for the task. If you follow out the aforementioned tips, you are likely to find an ethical and experienced advisor who can translate your investment dream into reality. After all, some advisor-client relations have continued for decades which sheds light on the fact that the right investment advisor is right away.


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Author: Advisorymandi

AdvisoryMandi is India's most trusted Stock Market Advisory marketplace covers NSE, BSE, MCX & NCDEX. Invest with confidence and harness the power of AdvisoryMandi to make smarter investment decisions in Stocks, Indices, Commodities, Forex & IPO.

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