The wealth management industry has undergone a sea-change over the last many years, but the Indian ultra-high net worth individual (UHNI) is still very traditional in the means or the medium that they choose for their investments; primarily the big investment is still in real estate. However, should that be the case? Is it not time to systematically, scientifically, and methodically review your portfolio and make it work for you and actually deliver that alpha?
Speaking about ultra-rich investors investing in products like PE funds, venture capital, startups, etc. Feroze Azeez, deputy CEO at AnandRathi Wealth Management said: “In a product-led wealth management, all these are very important products. However, in an objective-led wealth management, these guys don’t even have a place. We have to attach ourselves to an objective. If my objective is 15 percent, do I need this? I don’t need this.”
“As an investor I should find out what is my objective and what is the simplest way to achieve that objective rather than use a complex way to achieve more than my objective,” he added.
On generational wealth management, Azeez said: “It is not about where you got it from. The strategy should largely depend on how is it going to be consumed rather than how was it earned. If I am going to consume it in my lifetime, the strategy is going to be different and if my next generation is going to consume it, then the strategy would be different.”
He added" “One way of bifurcating your investment is bifurcating your financial life into two different phases, growth phase and consolidation phase. Growth phase is to grow your balance sheet. The behavioral pattern of the human being should change depending on which phase of life is he in.
"In consolidation phase, real estate does not have a place because I am consolidating, on a click of a button I need my money which is not happening in real estate. In a growth phase, real estate has a lot of meaning.”