PROJECT REPORT

ON
Wealth Management Sector
An Analysis Of Existing
And
Potential Market

AT
AXIS BANK LTD.
AHEMDABAD
Submitted By:
Ankit kanungo (MBA-III SEM! In Partial Fulfillment for Degree of
Master of Business Administration during the year 2008-0
AMITY BUSINESS SCHOOL, AMITY UNIVERSITY
RAJASTAN, JAIPUR


ACKNOWLEDGEMENT
It is a matter of great satisfaction and pleasure to
present this report on Analysis of Wealth Management
taking Axis bank as basis. I take this opportunity to owe my
thanks to all those involved in my training.
This project report could not have been completed
without the guidance of our !OO"DINATO" - MBA# Dr$
%&''(A %"I)A%T)A & project guide Dr$ AMIT DI*IDI.
Their timely help & encouragement helped me to complete
this project successfully.
I thank Mrs. )IN''T A+"A*A( (VI! "#!$I%!&'(
)#* for giving me opportunity to work at AXiS A!"# as a
$I!A!%& T'AI!&&.
I am thankful to Ms$ PAMPA +&O%& (MA&A+!# ,
W!A-') MA&A+!M!&'* and M"$ %A,"AB& T"IPAT&I
(%+M. W!A-') MA&A+!M!&'* for their encouragement and
able guidance at every stage of my training work.
I e(press my gratitude towards staff of *'A(T&
MANA+'M'NT D'PA"TM'NT -A-I% BAN.# those who
2
have helped me directly or indirectly in completing the
training.
3
WEALTH MANAGEMENT
SECTOR
AN ANALYSIS
OF
EXISTING AND POTENTIAL
MARKET
COMPANY GUIDE : FACULTY
GUIDE :
Ms. Pampa Ghosh Dr. Amit Dii!i
(Manager) (Prof.)
Wealth Management Department Amity Business
School
4
AXIS BAN (D!"#I) $aipur


INDEX
No. Parti"#$ars Pa%& No
% !&ecuti'e Summary
( )*+ecti'e , Scope of Pro+ect
- .ompany Profile
/ 0heoretical Bac1groun233
4 Pro+ections
5 Bi*liography
5
**
1. INTRODUCTION
2. CONCEPT OF WEALTH MANAGEMENT
Wealth Management Range
Key Elements of Wealth Management Se!"#es
Key Challenge Aea
3 Solution Framework
4. Wealth Management An Emerging Sector
5. Core Elements of Wealth Management Services
Packaged at various levels
A$!"soy
%n!estment &o#ess"ng 'tansa#t"on o"ente$(
C)sto$y* Safe+ee,"ng an$ Asset Se!"#"ng
En$-to-en$ %n!estment L"fe#y#le Management
Key function areas
Financial Planning
.
Cl"ent &of"l"ng
%n!estment O/0e#t"!e
Portfolio Strategy Definition / Asset Allocation
1ef"n"ng &otfol"o Stateg"es an$ &otfol"o Mo$el"ng
1etem"nat"on of &otfol"o Const"t)ents an$ Allo#at"on
of Assets
Strategy I!leentation
Portfolio "anageent
&otfol"o A$m"n"stat"on
&efoman#e E!al)at"on an$ Analyt"#s
Strategy #evie$ and Alignent
Re#al"/at"on of &otfol"o Stategy
Re/alan#"ng* Reallo#at"on an$ 1"!estment of Assets
%. Key Challenge Areas
H"ghly &esonal"2e$ an$ C)stom"2e$ Se!"#es3
&esonal elat"onsh", $"!"ng the /)s"ness3
E!ol!"ng Cl"ent &of"le3
Cl"ent %n!ol!ement Le!el3
&ass"on %n!estment '&h"lantho,y an$ So#"al Res,ons"/"l"ty(3
L"m"te$ Le!eag"ng Ca,a/"l"t"es of Te#hnology 'as an ena/le(3
Te#hn"#al A#h"te#t)e an$ Te#hnology %n!estment3
%nt"#ate Kno4le$ge of Coss-f)n#t"onal 1oma"n3
5
&. Solution Framework
6)al"ty of Se!"#e Le!el
7n"!esal Se!"#e Offe"ng
%n!estment "n &eo,le &o#esses
&"#e not a T)e 1"ffeent"ato
7n#on!ent"onal 1el"!ey Channel an$ Comm)n"#at"on
8le9"/"l"ty of Te#hn"#al A#h"te#t)e
:
'. SERVICES PROVIDED BY WEALTH MANAGEMENT
INSTITUTIONS
C)sto$"an Se!"#es
T)st Se!"#es
Ret"ement &lan Se!"#es
(. ADVANTAGES AND LIMITATIONS
)*. Consumer Point Of View :
Wealth Management
&MS !s Wealth manage an$ f)n$ manage3
%s &MS fo yo);
Ho4 to #hoose a &MS3
%n!estment ,h"loso,hy3
S#heme /en#hma+s3
M"n"m)m "n!estment3
Ret)ns3
Cost st)#t)e3
8e<)en#y of $"s#los)e3
=o+"ng ho)se3
Assets )n$e management 'A7M(3
)). CONCEPT OF ASSET CLASSES
Asset M"9

+ist ,f Different Asset -lass

>
Fi.ed De!osits
Me"ts an$ 1eme"ts
%nteest ates on 81s
Effe#t"!e Ret)n
"/0/A+ F/1D
,!en2end fund
3.c4ange2traded funds
35uity funds
-a!itali6ation
7ond funds
"oney arket funds
Funds of funds
8edge funds
35uity investent
Direct 4oldings and !ooled funds
-oodities "arket
A#0 F/1D
1"!es"f"e$ ,otfol"o
T"e-),s 4"th galle"es
#3A+ 3S0A03 F/1D
Insurance Product
?@
Geneal %ns)an#e
7n"t L"n+e$ %ns)an#e &lan '7L%&(
Structured Product
-o!osition
R"s+s
9,+D
Factors influencing t4e gold !rice
gol$ /e#omes $es"a/le "n t"mes of
=an+ fa"l)es
Lo4 o negat"!e eal "nteest ates
Wa* "n!as"on* loot"ng* #"s"s
-urrency
&otfol"o #om,os"t"on of #)en#y
)2. Companies providing Wealth management services
Kotak securities
%NTRO17CT%ON
&RO17CTS
ASSET CLASSES 7SE1
ASSET S%AE
%NBESTMENT &H%LOS&HC
"organ Stanley
%NTRO17CT%ON
&RO17CTS
ASSET CLASSES 7SE1
??
ASSET S%AE
%NBESTMENT &H%LOS&HC
"oti +al ,s$al
%NTRO17CT%ON
&RO17CTS
ASSET CLASSES 7SE1
ASSET S%AE
%NBESTMENT &H%LOSO&HC
#eligare :ealt4 "anageent
%NTRO17CT%ON
&RO17CTS
ASSET CLASSES 7SE1
ASSET S%AE
%NBESTMENT &H%LOSO&HC
Standard c4artered

%NTRO17CT%ON
&RO17CTS
ASSET CLASSES 7SE1
?2
ASSET S%AE
%NBESTMENT &H%LOS&HC
A;n Aro :ealt4 "anageent
%NTRO17CT%ON
&RO17CTS
ASSET CLASSES 7SE1
ASSET S%AE
%NBESTMENT &H%LOS&HC
8S7- Financial Planning Services
&RO17CTS
ASSET CLASSES 7SE1
ASSET S%AE
%NBESTMENT &H%LOSO&HC
?3
-iti 7ank
%NTRO17CT%ON
&RO17CTS
ASSET S%AE
ASSET CLASSES 7SE1
%NBESTMENT &H%LS&OHC
I-I-I :ealt4 "anageent
%NTRO17CT%ON
&RO17CTS
ASSET CLASSES 7SE1
ASSET S%AE
%NBESTMENT &H%LS&OHC
)3. AXIS BANK & WEALTH MANAGEMENT
&o#e$)e fo enteta"n"ng a #l"ent "n AD%S =ANK
Co)stme &of"l"ng at A9"s =an+
7,to 3@ yeas of age
3@-45 yeas of age
45-.@ yeas of age
o!e .@ yeas
)4. :3A+08 "A1A93"310 < I1DIA1 -,1-3#1
&os"t"on of %n$"a "n Wealth Management
R"s+ a!es"on of %n$"an #)stomes
?4
)5. "IDD+3 3AS0 = :3A+08 "A1A93"310

)%. :3A+08 "A1A93"310 ,1 9+,7A+ P#3SP3-0I>3



?5
?.
3?3-/0I>3 S/""A#@
Axis Bank Wealth Management provides discretionary wealth
management service, in which wealth managers give
recommendations to customers and invest according to
customer discretion.
My Project is the study of Wealth Management ector,An
Analysis !f "xisting And Potential Market.
04e study $as conducted at t4e ain ;ranc4 of A?IS
7A1KA-PA13: D3+8I.
04e !roBect $as of % $eeks duration.
#uring the project $ had taken the guidance of Wealth
managers % sta& to collect the data, % also made use of
'ompany(s various reports. )he data collected were then
compiled, ta*ulated and analy+ed.
Apart from objectives# Some of the points which is considered in this
topic to make project report more comprehend are )*
+. ,hat a customer e(pects from a wealth management service
provider.
-. Solution framework for wealth management.
33 Key Challenge Aeas3
.. %ore &lements of ,ealth /anagement Services.
?5
,7C3-0I>3S
,- )hrough the past results, to identify the potential of wealth
management sector.
.- /nderstanding company(s procedure in wealth management
department.
0- )o know the comparative position of the companies o&ering
wealth management services.
1- )o have a general notion on di&erent asset classes availa*le
in 2nancial market.
3- )o have a conceptuali+ed view on wealth mangagment
services.


?:
COMPANY PROFILE
Axis Bank was the 2rst of the new private *anks to have *egun
operations in ,441, after the 5overnment of $ndia allowed new
private *anks to *e esta*lished. )he Bank was promoted
jointly *y the Administrator of the speci2ed undertaking of the
/nit )rust of $ndia 6/)$ 7 $-, 8ife $nsurance 'orporation of $ndia
68$'- and 5eneral $nsurance 'orporation of $ndia 65$'- and
other four P/ insurance companies, i.e. 9ational $nsurance
'ompany 8td., )he 9ew $ndia Assurance 'ompany 8td., )he
!riental $nsurance 'ompany 8td. and /nited $ndia $nsurance
'ompany 8td.
)he Bank today is capitali+ed to the extent of :s. 03;.3< crores
with the pu*lic holding 6other than promoters- at 3=.<>?.
)he Bank(s :egistered !@ce is at Ahmeda*ad and its 'entral
!@ce is located at Mum*ai. Presently, the Bank has a very
wide network of more than =>, *ranch o@ces and "xtension
'ounters. )he Bank has a network of over .;31 A)Ms providing
.1 hrs a day *anking convenience to its customers. )his is one
of the largest A)M networks in the country.
)he Bank has strengths in *oth retail and corporate *anking
and is committed to adopting the *est industry practices
internationally in order to achieve excellence.
?>
Th&or&ti"a$ 'a"(%ro#)!
INTRODUCTION
The term ,ealth management also now a days having very
importance. So many anking companies are engaged in the business
of ,ealth management. The premier insurance industry is now
booming because so many bankers are also adopting and playing safe
in the business of insurance the term called is ancassurance. !ow a
days ,ealth /anagement has very cra0e in the business world. In a
survey it was found that India had +11#111 miolliners day end of year
-112 is now grow up by -+3 from a year earlier 4Asia pacific ,ealth
report5.
Wealth management services area in 2nancial sector has *een
witnessing more attention during last couple of years.
'apgemini Merrill 8ynch Wealth :eport .>>= cites num*er of
A9W$s glo*ally to *e around 4.3 million with wealth held *y
them totaling to /B0=.. trillion in year .>><. Calue of wealth
held *y A9W$s represents an increase of around ,,.1? since
.>>3.
'onsidering long7term high value *usiness proposition,
num*er of *anks and niche players has started o&ering full
range of wealth management services targeted to A9W$s and
emerging aDuents.
While growing volume of premium services to aDuent clients
*ecomes the key driver for most of the service provider 2rms,
many uniEue elements inherent to wealth management
services reEuires completely di&erent service o&ering model
than the existing model for transactional services. 5reatly
accustomed in o&ering commoditi+ed 2nancial services so far,
demand of unconventional form of service model poses a *ig
challenge in charting growth path for these wealth
management 2rms.
CONCEPT OF WEALTH MANAGEMENT
2@
The term ,ealth management formed with two words ,ealth &
/anagement. The /eaning of /anagement They have already seen in
the steering introduction. The meaning of ,ealth is 6 $unds# Assets#
investments and cash it means the term ,ealth management deft with
funds Asset# instrument# cash and any other item of similar nature.
,hile defining ,ealth /anagement They have to think in planned
manner. 7,ealth /anagement is an all inclusive set of strategies that
aims to grow# manage# protect and distribute assets in a much
planned systematic and integrated manner8.
2?
WEALTH MANAGEMENT RANGE
The Indian market has been segmented by ,ealth management
service providers into five categories# namely)
7lta-h"gh net 4oth* o 7lta-HNW '"n e9#ess of 7SE3@ m"ll"on(* 4"ll ha!e a
total ,o,)lat"on of ?@*5@@ ho)sehol$s /y 2@?23
S),e h"gh net 4oth '/et4een 7SE?@ an$ E3@ m"ll"on( 4"ll ha!e a total
,o,)lat"on of 42*@@@ ho)sehol$s /y 2@?23
H"gh net 4oth '/et4een 7SE? m"ll"on an$ E?@ m"ll"on( 4"ll ha!e a total
,o,)lat"on of 32@*@@@ /y 2@?23
S),e affl)ent '/et4een 7SE?25*@@@ an$ E? m"ll"on( 4"ll ha!e a total ,o,)lat"on
of 35@*@@@ ho)sehol$s /y 2@?23
Mass affl)ent '/et4een 7SE25*@@@ an$ E?25*@@@( 4"ll ha!e a total ,o,)lat"on of
?3: m"ll"on ho)sehol$s /y 2@?23
/ass market 4between 9S:;#111 and :-;#1115 will have a total
population of <= million households by -1+-.
The range of ,ealth management can be e(pressed by this e(hibit
chart.
ST9>&!T STA'T ?$ %A'&&'
%A'&&'
&STA@ISA&>
'&TI'&/&!T
@iBuidity
/anagement
4%ash /gt5
C >eposit based comfort
ADc
C %redit cards
C %omfort ADc with credit limit
C Eold %ard
C Fremium ADc
C Flatinum %ard
C Fremium ADc
C Flatinum %ard
C ?vernight money ADc
C /oney /arket & $i(ed Income $und
C !ear /oney /arket $und
C GI!S Flus
C ?vernight money ADc
C /oney /arket & $i(ed Income $und
C !ear /oney /arket $und
C GI!S Flus
C Special Investments
,ealth
$ormation
4Savings Flans5
C Top portfolio
C $lagship portfolio
C Titan portfolio
C Top portfolio
C $lagship portfolio
C Titan portfolio
C %apital formation benefit funds
C Top portfolio
C $lagship portfolio
C Titan portfolio
,ealth

C Absolute 'eturn Fortfolio
22
?ptimi0ation
4@ump sum
Investment5
C Aolding and Frivate &Buities
C /odular ,ealth /anagement
C Individual ,ealth /anagement
C Fremium Fortfolio
C Titan Fortfolio
K&* E$&m&)ts o+ ,&a$th Ma)a%&m&)t S&r-i"&s
Wealth management services involve 2duciary responsi*ilities
in providing professional investment advice and investment
management services to a client. #epending on the mandate of
the services given to the Wealth Manager, wealth management
services could *e packaged at various levelsF
a( A$!"soy
/( %n!estment &o#ess"ng 'tansa#t"on o"ente$(
#( C)sto$y* Safe+ee,"ng an$ Asset Se!"#"ng
$( En$-to-en$ %n!estment L"fe#y#le Management
:ealt4 anageent services co!rises of follo$ing key
function areas of<
4a5 $inancial Flanning
4b5 Fortfolio Strategy >efinitionD Asset Allocation D Strategy
Implementation
H Fortfolio /anagement 6Administration# Ferformance &valuation
and Analytics
4d5 Strategy 'eview and /odification.
23
24
K&* Cha$$&)%& Ar&a
Wealth management 2rms face many challenges in formulating
winning services o&ering meeting the client needs. ome of
key challenges faced *y wealth management 2rms areF
?3 H"ghly &esonal"2e$ an$ C)stom"2e$ Se!"#es
23 &esonal elat"onsh", $"!"ng the /)s"ness
33 E!ol!"ng Cl"ent &of"le
43 Cl"ent %n!ol!ement Le!el
53 &ass"on %n!estment '&h"lantho,y an$ So#"al Res,ons"/"l"ty(
.3 L"m"te$ Le!eag"ng Ca,a/"l"t"es of Te#hnology'as an ena/le(
53 Te#hn"#al A#h"te#t)e an$ Te#hnology %n!estment
:3 %nt"#ate Kno4le$ge of Coss-f)n#t"onal 1oma"n
Solution Frame work
A A9W$ client expects exclusiveness in services and key to
success for a 2rm lies in o&ering exclusiveness in services
delivery 6high Euality services on most personali+ed *asis-,
going *eyond client expectations.
A solution framework with considered inclusion of following
key elements would help 2rms in meeting and exceeding client
needs towards sustaina*le *usiness growthF
,. Guality of ervice 8evelF Aighly focused around client needs,
a *road framework of service o&ering would *e revolving
aroundF Anticipate, Analy+e, Advice, Act and Monitor cycle.
23 7n"!esal Se!"#e Offe"ng
33 %n!estment "n &eo,le &o#esses
43 &"#e not a T)e 1"ffeent"ato
53 7n#on!ent"onal 1el"!ey Channel an$ Comm)n"#at"on
<. Hlexi*ility of )echnical ArchitectureF Against the *ackground
of lack of clarity on *usiness model and involved process, A
loosely oriented technical architecture with optionality and mix
of Build I Buy I $ntegrate components would *e considered as
a good *eginning point.
)o meet the information technology reEuirements, a 2rm has
several alternatives 6or com*ination of alternatives- to
considerF
%ntegate$ sol)t"on a,,oa#hF 1e!elo,"ng "n-ho)se a,,l"#at"ons to meet en$-to-en$
ne4 /)s"ness e<)"ements3
Se!"#e =)ea) GAS& Mo$elF %nfomat"on te#hnology se!"#e ,o!"$es offe"ng
"ntegate$ en$-to-en$ ,o#ess"ng "nfast)#t)e an$ se!"#es "n#l)$"ng #oe of
/)s"ness ,o#esses of 4ealth management3
25
Stan$-alone #omme#"al soft4ae ,o$)#tGsol)t"onsF &e-,a#+age$ sol)t"ons that #an
/e fo#)se$ to s,e#"f"# ,at of se!"#es o ,o!"$e #om,ehens"!e en$-to-en$
,o#ess"ng3
2.
)o provide enough resilience and high *usiness relevance, any
of the considered option and associated technical structure
should keep due provisions for the following key elementsF
R)le /ase$ ,o#ess"ng to manage #om,le9 /)s"ness )les an$ se!"#e $ef"n"t"ons3
Cl"ent ,of"le G $ata management to #ate a ,of"le $"!en sol)t"on offe"ng3
Com,le9 $e#"s"on s),,ot an$ #l"ent o"ente$ analyt"#s3
8le9"/"l"ty to "n#o,oate man)al ,o#ess"ng "ntefa#es "n a,,l"#at"ons3
25
Wealth Management 6 An !merging Sector
Wealth management services area in 2nancial sector, hitherto
used to *e the preserve of some top multinational *anks and
2nancial 2rms7 o&ering exclusive services to a select few, has
*een witnessing more attention during last couple of years.
A *ooming economy, rising stock prices and an increase in
income and spending power have *rought sharp focus on this
sector. With an increasing population of Aigh 9et worth
$ndividuals 6A9W$s-,, the unsaid tagline of earlier days 7
J#on(t call us. We(ll call you 6if you are that wealthyK-L seems
to *e completed altered in recent times. 'onsidering long7term
high value *usiness proposition, num*er of *anks, 2nancial
2rms and niche players has started o&ering full range of
wealth management services targeted to A9W$s and emerging
aDuents.
As per recently pu*lished 'apgemini Merrill 8ynch Wealth
:eport .>>=, num*er of A9W$s around the world and value of
their assets has *een continuously rising. 9um*er of A9W$s
glo*ally is estimated to *e around 4.3 million in year .>><, an
increase of over ;.03? over previous year. A9W$ wealth totals
/B0=.. trillion, representing an increase of around ,,.1?
since .>>3. As per report, num*er of A9W$s in $ndia is
increasingly growing I at a rate higher than other region of
world. 9um*er of A9W$s in $ndia is estimated to *e around
,>>,>>> in year .>>< 7 an increase of over .>.3? over previous
year. )hough, in a*solute terms the a*ove num*er appears
pretty miniscule 6if we compare that with the num*er of retail
investors in $ndia.-, however, in terms of value it really makes
a really huge sum of servicea*le investment0.
While growing volume of premium services to aDuent clients
*ecomes the key driver for most of the service provider 2rms,
many uniEue elements inherent to wealth management
services reEuires completely di&erent service o&ering model
than the existing model for transactional services. )o meet the
client service expectations accurately, servicing model and
framework has to *e deeply oriented with high level of client
satisfaction. $t is not a surprise that many of successful 2rms
in wealth management sector draw lessons from successful
service leaders from hospitality, entertainment and retailing
industries, to learn the trick of enhanced client satisfaction.
5reatly accustomed in o&ering commoditi+ed 2nancial services
so far, demand of unconventional form of service model poses
a *ig challenge in charting growth path for these wealth
management 2rms.
2:
Core Elements o We!lt" M!n!#ement
$er%&'es
In most basic sense# wealth management services involve fiduciary
responsibilities in providing professional investment advice and
investment management services to Institutions# funds
4FensionDmutualDAedge5# corporations# trusts as well as A!,Is. In the
present conte(t of our discussion#we would keep our focus limited to
A!,Is.
Some of analogous terms used for wealth management could be
considered as Fortfolio /anagement# Investment /anagement and
many times $und /anagement or Asset /anagement.
1e,en$"ng on the man$ate of the se!"#es g"!en to the Wealth Manage* 4ealth
management se!"#es #o)l$ /e &a#+age$ at !a"o)s le!els
a- Advisory
Wealth mangeHs ole "s l"m"te$ to the e9tent of ,o!"$"ng g)"$an#e on
"n!estment G f"nan#"al ,lann"ng an$ ta9 a$!"soy* /ase$ on #l"ent ,of"le3
%n!estment $e#"s"ons ae solely ta+en /y the #l"ent* as ,e h"s Ghe o4n 0)$gment3
*- $nvestment Processing 6transaction oriented-
Cl"ent engages 4ealth manage to e9e#)te s,e#"f"# tansa#t"on o set of
tansa#t"ons3 %n!estment ,lann"ng* $e#"s"on an$ f)the management ema"n
!este$ 4"th the #l"ent3
c- 'ustody, afekeeping and Asset ervicing
Cl"ent "s es,ons"/le fo "n!estment ,lann"ng* $e#"s"on an$ e9e#)t"on3 Wealth
manage "s ent)ste$ 4"th management* a$m"n"stat"on an$ o!es"ght of
"n!estment ,o#ess3
d- "nd7to7end $nvestment 8ifecycle Management
Wealth manage o4ns the 4hole gam)t of "n!estment ,lann"ng* $e#"s"on*
e9e#)t"on an$ management* on /ehalf of the #l"ent3 He "s man$ate$ to ma+e
f"nan#"al ,lann"ng* "m,lement "n!estment $e#"s"ons an$ manage the "n!estment
2>
tho)gho)t "ts l"fe 3Wealth management se!"#es #om,"ses of follo4"ng Key
f)n#t"on aeas F
a5 $inancial Flanning
b5 Fortfolio Strategy >efinition D Asset Allocation
c5 Strategy Implementation
d5 Fortfolio /anagement
e5 Strategy 'eview and Alignment
a) Financial Planning
Cl"ent &of"l"ng
'lient pro2ling takes in account multitude of *ehavioural,
demographic and investment characteristics of a client that
would determine each client(s wealth management
reEuirements. ome of key characteristics to *e evaluated for
de2ning client(s investment o*jective areF
C)ent an$ f)t)e %n#ome le!el
8am"ly an$ l"fe e!ents
R"s+ a,,et"te G tolean#e
Ta9a/"l"ty stat)s
%n!estment ho"2on
Asset &efeen#e Gest"#t"on
Cash flo4 e9,e#tat"ons
Rel"g"o)s /el"ef 'non "n!estment "n s"n se#to l"+e - al#ohol* to/a##o* gam/l"ng f"ms*
o #om,l"ant 4"th Sha"a la4s(
=eha!"o)al H"stoy '&atten of ,ast "n!estment $e#"s"ons(
Le!el of #l"entHs engagement "n "n!estment management 'a#t"!e G ,ass"!e(
&esent "n!estment hol$"ng an$ asset m"9
3@
%n!estment O/0e#t"!e
Based on the client pro2le, investment expectations and
2nancial goals of the client could *e clearly outlined. #e2ning
investment o*jectives helps to identify investment options to
*e considered for evaluation. $nvestment o*jective for most of
the investors could *e generally considered amongst the
followingF
C)ent %n#ome
Go4th 'Ca,"tal A,,e#"at"on(
Ta9 Eff"#"en#y 'Ta9 Ha!est"ng(
Ca,"tal &ese!at"on 'often ,efee$ /y el$ely ,eo,le to ma+e s)e they $onHt
o)tl"!e the" money3(
*-Portfolio trategy #e2nition M Asset Allocation
Defining Portfolio Strategies an2 Portfolio Mo2eling
After esta*lishing investment o*jectives, a *road framework
for harnessing possi*le investment opportunities is
formulated. )his framework would factor for risk7return trade7
o& of considered options, investment hori+on and provide a
clear *lueprint for investment direction.
$nvestment strategy helps in forming *road level envisioning
of asset class 6ecurities, Horex, 'ommodity, :eal tate,
:eference and $ndices, ArtMAntiEue and 8ifestyle Assets 6'ar,
Boat,Aircraft--, market, geography, sector and industry. "ach
of these asset classes is to *e comprehensively evaluated for
inclusion in portfolio model, in view of de2ned investment
o*jectives.
While de2ning the strategy, consideration of client preference
or avoidance for speci2c asset class, risk tolerance, religious
*eliefs is the key element, which would come into picture.
)hus, for a client with a *elief of avoidance of investment in
sin industries 6alcohol, to*acco, gam*ling etc.- is to *e duly
taken care of. 8ikewise, for a client looking for haria7
compliant investment, strategy formulation should consider
investment options meeting with the client expectations.
Deterination of Portfolio -onstituents and Allocation
of Assets
3?
5uided with the investment strategy, constituents in portfolio
model are determined, which would directly and e@ciently
contri*ute towards client(s investment o*jectives. )hus, a
*road level investment guidance of I Jinvestment in 2xed
income in emerging marketL would further determine
classi2cation within Hixed $ncome such as 5ovt. or corporate
*onds, 2xed or varia*le rate *onds, 8ong or short maturity
*onds, #eep discounted or Par *onds, Asset *acked or other
de*t variants. :eturn pro2le, risk sensitivity and co7relation of
constituents within portfolio model would help to
determine the si+e 6weightage- of each individual constituent
in the portfolio.
c- trategy $mplementation
Aaving decided the portfolio constituents and its composition,
transactions to acEuire speci2c instruments and identi2ed
asset class is initiated. As acEuisition cost would *e having
*earing on overall performance of the portfolio, many times
process of asset acEuisition may *e spread over a period of
time to take care of market movement and acEuire the asset at
favoura*le price range.
d- Portfolio Management
Portfolio A2ministration
Portfolio Administration involves handling of investment
processes and asset servicing. )his would also reEuire tax
management, portfolio accounting, fee administration, client
reporting, document management and general administration
relating with portfolio and client. )his function would involve
*ack o@ce administration and custodial services to manage
transaction processes 6trading and settlement- 7 interfacing
with *rokersMdealersMagents, Hund managers, 'ustodians, 'ash
Agent and many other market intermediaries.
Performance !'aluation an2 Analytics
Performance evaluation of the portfolio is an ongoing process.
Portfolio return is continuously monitored and analy+ed with
respect to de2ned portfolio o*jectives. Analysis dimension
could *e varied I simple and complex. )hese may include 7
a*solute return, relative return 6in comparison to chosen
*enchmark-, trend, pattern, cost impact, tax impact,
concentration, lost opportunity and other form of sensitivity
and what7if analysis. Any deviation of portfolio performance
o*served during performance evaluation would lead to
stategy e!"e4 an$ any ,oss"/le al"gnment of ,otfol"o stategy3
32
e(Stategy Re!"e4 an$ Al"gnment
7ecali*ration of Portfolio Strategy
Based on performance evaluation and future outlook of the
investment, portfolio strategy is evaluated on periodic *asis.
)o keep it aligned with the de2ned investment o*jectives,
portfolio strategy is suita*ly re7cali*rated from time to time.
Many times, review of portfolio strategy would *e necessitated
due to change in client pro2le or expectations.
7e*alancing8 7eallocation an2 Di'estment of Assets
Any re7cali*ration of strategy and conseEuent change in
portfolio model would reEuire re*alancing of the assets in
portfolio. )his would *e achieved through re*alancing the
asset
6divesting over7allocated part and acEuiring under allocated-,
relocation 6from one sector the other or from one instrument
to other instrument in the same class- or complete divestment.
33
ey .hallenge Areas
While immense *usiness potentiality of this emerging sector is
a driving point for most of the 2rms, they face many
challenges in formulating winning services o&ering meeting
the client needs. $n the following section, we would *rieNy take
a look on the key challenges area in the present context.
H"ghly &esonal"2e$ an$ C)stom"2e$ Se!"#es
/nlike other stream of 2nancial services, mostly *eing
transactional M commoditi+ed in nature, wealth management
services reEuire client speci2c solution and service o&ering. 9o
one solution exactly meets the needs of other client. $n a
situation of highly personali+ed and customi+ed nature of
service o&ering, developing any form of generic service model
does not support growth of the *usiness.
&esonal elat"onsh", $"!"ng the /)s"ness
)o meet client expectation of personal attention, mode of
communication in wealth management services tends to *e
highly personali+ed. )hus, the conventional grids of
communication, such as call centre, data centre does not 2t
well. uccess of wealth management services heavily draws on
personal interaction with the dedicated relationship manager,
who takes care of whole investment management lifecycle for
*unch of clients on one7to7one *asis. )his essentially reEuires
service 2rm to invest heavily in human processes to groom and
retain a team on competent relationship managers with cross
functional skills.
E!ol!"ng Cl"ent &of"le
)he *iggest challenge in providing wealth management service
o&ering is to factor and reckon the evolving nature of client
pro2le, in terms of investment o*jective, time hori+on, risk
appetite and so on. )hus, a service model developed for a
particular client cannot remain static over a period of time.
Any
service model has to *e Nexi*le enough to consider the
dynamic nature of client pro2le and expectations arising out of
it.
Cl"ent %n!ol!ement Le!el
34
)he conventional adage I the more money you have, more
e&ort is needed to manage it I proves to *e otherwise in case
of A9W$s. 5enerally, client involvement in managing the
2nance remains on the lower side. )his *rings onus of
managing the whole gamut of investment and due
performance single7handedly on the shoulders of investment
manager.
35
&ass"on %n!estment '&h"lantho,y an$ So#"al Res,ons"/"l"ty(
$n the recent years a trend has *een o*served that *ulk of
investments *y A9W$s has *een directed towards passion
investments 6art, antiEue, jewellery, coins, uniEue assets,
luxury-, philanthropy and socialMcommunity causes.
As per World Wealth report, ,,? of A9W investors worldwide
contri*uted to philanthropic causes with a contri*ution over
=? of their wealth in year .>><. /ltra7A9W$s contri*ution was
even more 7 ,=? of /ltra7A9W investors that gave to
philanthropy contri*uted over ,>? of their wealth. $n total,
this eEuates to more than /B.;3 *illion glo*ally. Against this
*ackdrop, new *reed of A9W$s expect to strategically manage
the wealth and personal resources allocated to philanthropy
purpose, in order to maximi+e its impact. )his demands a
relationship manager not just to *e a passive 2nancial advisor
rather a passionate partner sharing interest and inclination of
the associated client.
L"m"te$ Le!eag"ng Ca,a/"l"t"es of Te#hnology 'as an ena/le(
$n the recent times, we have witnessed technology a key
ena*ler to help *usiness to expand its market reach with
reduced cost of services o&ering. !nline *anking and online
tradingM*rokerage services are the *est examples in this
regard. )echnology leveraging has helped services 2rm to
achieve universal proliferation of market with su*stantially
reducing transaction cost. As *usiness rules and service
de2nitions to guide the applications tends to *e Euite
composite in wealth management services, leveraging the
capa*ilities of technology to meet the *usiness reEuirement
may not *e highly feasi*le in the initial years.
Te#hn"#al A#h"te#t)e an$ Te#hnology %n!estment
As *usiness architecture is still evolving, a proven *asis of
resilient technical architecture and framework to support the
emerging *usiness greatly remains missing. $n a*sence of this
framework, any investment commitment towards application
development M system implementation would *e fraught with
severe risk.
%nt"#ate Kno4le$ge of Coss-f)n#t"onal 1oma"n
By very nature of wealth management, it not just involves
matters of plain vanilla 2nance *ut has intricate relationship
with many elements of domestic M international law, taxation
and regulatory norms. $n order to provide sound investment
3.
guidance, a relationship manager is reEuired to have intricate
knowledge of domesticMcross7*order 2nance, accounting, legal
and taxation su*jects.
35
Solution 9rame:or1
5eneric services o&ering model is going to draw *ig *lank in
case of wealth management services. A A9W$ client expects
exclusiveness in services in a normal manner. $n highly
competitive market, key to success for a 2rm lies in o&ering
exclusiveness in services delivery 6high Euality services on
most personali+ed *asis-, going *eyond the client
expectations.
A solution framework with considered inclusion of following
key elements would help 2rms in meeting and exceeding client
needs towards sustaina*le *usiness growth.
6)al"ty of Se!"#e Le!el
Guality of service level provided *y the service provider 2rm
would the key determinant of growth and success in client
acEuisition, client satisfaction and client retention aspects.
$n a sense, service o&ering could *e developed in the form of
partnership with the client *ased on trust and integrity, where
the relationship manager remains highly responsive to client
sensitivities and expectations.
Without over7emphasi+ing, a satis2ed client would provide
multitude of opportunities of growth of *usiness I through
deepening the relationship, direct M indirect referencing as well
as cross selling of products. $n the other situation of de2ciency
in service level, he would not hesitate to move the *usiness
to another 2rm. )his keeps strong emphasis on continued
engagement with the client on the aspects of client
expectation and servicing, rather than showing extra attention
only during the period of client acEuisition. Hocused around
client needs, a *road framework of service o&ering during
whole lifecycle of client investment management would *e
revolving aroundF Anticipate, Analy+e, Advice, Act and Monitor
cycle.
.
3:
3>
7n"!esal Se!"#e Offe"ng
)o meet the client needs in holistic manner, product and
service o&ering range of the 2rm should *e wide enough to
cover the investment spectrum across its lifecycle. $n an ideal
situation, a client would expect to deal with a single 2rm to get
complete range of investment management services. Aowever,
for various *usiness considerations of the service provider
2rm, in many situations it may not *e a via*le proposition to
o&er those services. While universal service o&ering with
assortment of services under single um*rella is not attaina*le
in house, it could *e achieved through active partnership and
a@liation. But, due consideration is reEuired that Euality of
service level provided *y partnersMa@liates does not get
compromised in any manner. Any shortcoming in service
Euality, even if caused *y partnerMa@liate(s services, would *e
ultimately impairing client satisfaction towards the 2rm.
%n!estment "n &eo,le &o#esses
As relationship manager remains the face of the 2rm to a
client, success of the 2rm would *e greatly dependent on the
skills, drive and enthusiasm of relationship managers 6to take
an extra mile-, while *onding and dealing with any of client
issues. )his aspect is more challenging than as it appears. )his
necessitates transformation of organi+ational philosophy
towards its people and people processes contri*uting to
*usiness success. Hirms would *e reEuired to invest heavily in
human processes to attract, groom and retain a motivated
team of relationship managers, who will make the real
di&erence *etween winning and losing the game.
&"#e not a T)e 1"ffeent"ato
Pricing as a key di&erentiator to distinct the service o&ering
from one 2rm to other may not *e highly relevant in case of
wealth management services. Hocused on performance and
Euality of service, pricing in isolation will not make much
meaning to service seeking clients. 'lient would always value
the pricing from the Euality of services received. Ae will
certainly not mind paying extra, if he 2nds services o&ered
to him meeting and exceeding his expectations.
7n#on!ent"onal 1el"!ey Channel an$ Comm)n"#at"on
#elivery channel for service content and mode of
communication has to *e greatly customi+ed I aligned with the
client7desired vehicles. )his would reEuire a process of
continuous re7inventing and re7de2ning the grid of delivery
4@
and communication channels to meet client expectations.
$mpact of technological advancements and its interplay on
service delivery and communication method would certainly *e
an
eEually challenging aspect to *e factored in, while designing
such strategies.
4?
8le9"/"l"ty of Te#hn"#al A#h"te#t)e
While *usiness potential appears to *e Euite high, existing
*usiness architecture still does not provide any sound *asis to
formulate technical roadmap. Added to that, dynamic
characteristics of client pro2le *ring an increased challenge in
drawing a 2rm implementation *lueprint.
$n the given situation, any *ig7*ang commitment towards
technical implementation plan would not *e a wise idea. A
prudent approach would *e to get started on modular *asis
with progressive integration of functional components in order
of its functional signi2cance. 5aining insight and con2dence
around the *usiness processes, this could *e gradually scaled
over the period of time.
)o meet the information technology reEuirements, a 2rm has
several alternatives 6or com*ination of
alternatives- to considerF
a) Integrated solution approach: #eveloping in7house applications to
meet end7to7end new *usiness reEuirements. )hese
applications are *ased on existing technology architecture of
the 2rm and are closely integrated with the existing service
models. $t would *e a least preferred choice in the current
situation, on count of cost, time, lack of clarity and complexity
of solution.
*- Service Bureau /ASP ModelF A recent trend has *een witnessed in
the solution provider(s landscape. Many of information techno
service providers have come out with novel solution for
investment management M investment processing platform in
the form of service *ureau M AP. )his platform provides
integrated end7to7end processing infrastructure and services
including core of *usiness processes of wealth management.
!n the part of a wealth management 2rm, paying agreed
charges to service *ureau provider, option of service *ureau
completely eliminates the reEuirement of ongoing resource
commitment and cost of maintaining information technology
infrastructure. While total cost of owning may *e the key
motivating point for a wealth management 2rm to adopt
service *ureau model, the key consideration of providing high
Euality of service level with enhanced responsiveness may not
*e adeEuately answered.
c) Stand-alone commercial software product/solutions: Pre7packaged solutions
that can *e focused to speci2c part of services or provide
comprehensive end7to7end processing. )hese can *e
deployed independently or could *e integrated with existing
systems. 'ost, customi+ation and integration di@culties would
*e the challenging points.
42
A loosely oriented technical architecture with optionality and
mix of Build I Buy I $ntegrate components would *e considered
as a good *eginning point. )o provide enough resilience and
high *usiness relevance, any of the considered option and
associated structure should keep due provisions for the
following key elementsF
Cons"$e"ng the #om,le9"ty of /)s"ness ,o#esses an$ "n!ol!e$ /)s"ness )les* )le
/ase$ ,o#ess"ng 4o)l$ /e the #oe of ,o#ess"ng3
Cl"ent ,of"le a#<)"es many ne4 $"mens"ons 4"th ,lethoa of att"/)tes3 Cl"ent $ata
"s e<)"e$ to /e a,,o,"ately manage$ 'aggegate G segegate( to /)"l$ a ,of"le
$"!en sol)t"on offe"ng3
1e#"s"on s),,ot an$ #l"ent o"ente$ analyt"#s a#<)"e moe "m,otan#e3
A,,l"#at"ons sho)l$ ,o!"$e a$e<)ate fle9"/"l"ty to "n#o,oate man)al ,o#ess"ng
"ntefa#es3

43
$ER(ICE$ PRO(IDED )Y WEALTH
MANAGEMENT IN$TITUTION$
4+5 %ustodian Services
4A5 Securities Safekeeping
45 Income collection from Securities
4%5 Settlement of Securities trades as directed
4>5 Fayment of fund when directed
4&5 Timely settlement delivery
4-5 Trust Services
4A5 %haritable Trust
45 'evocable Trust
4%5 Irrevocable life Insurance Trust
4>5 Special !eed Trust
4&5 Institutional Trust
4<5 'etirement Flan Services
4A5 I'AIs %ustodian ?r Trustee
45 >efined enefit Flans
4%5 >efined %ontribution Flans
44

45
4.
,ealth /anagement Fractice ?rientation ?verview
0ransactors;
&o$)#t E9,etF Han$les h"gh-!ol)me tansa#t"ons "n!ol!"ng so,h"st"#ate$ ,o$)#ts
o asset #lasses* s)#h as foe"gn e9#hange $e"!at"!es3
%n!estment =o+eF Han$les tansa#t"ons "n!ol!"ng /as"# asset #lasses* s)#h as
e<)"t"es* f"9e$ "n#ome an$ o,t"ons3
In'estment Managers;
%n!estment A$!"soF Offes stateg"# "n!estment ,lann"ng* as 4ell as ,lay"ng a han$s-
on ole "n #onst)#t"ng* e!"e4"ng an$ e/alan#"ng #l"ent ,otfol"os3
Relat"onsh", ManageF Esta/l"shes an$ n)t)es #l"ent elat"onsh",s* $elegat"ng
,otfol"o management to "ntenal o e9tenal manages3
Wealth Planners;
Wealth &lanneF Offes hol"st"# a$!"#e "n a##o$an#e 4"th #l"entHs f"nan#es an$
shot-Glong-tem goals* s)#h as eal estate* et"ement an$ geneat"onal 4ealth
tansfe3
&esonal C8OF As,"es to ,o!"$e <)as" fam"ly-off"#e se!"#es* often a#t"ng "n a lea$
$"s#et"onay ole #oo$"nat"ng 4"th the #l"entHs othe t)ste$ a$!"sos3
45
)he signi2cance of these practice7model categories is that
each reNects a di&erent advisory approach, *orne of a
di&erent perspective. While some 2rms claim to have a single
practice orientation, many actually use multiple models in and
across regionsOand often leverage di&erent models within
their core markets to capitali+e on the strengths of individual
advisors. As they move into new markets, 2rms can create or
exacer*ate friction among the di&erent advisory approaches
they use. $mportantly, practice orientations need not *e
mutually exclusive, *ut the mix of intra72rm practice models
does need to *e consciously managed.
4:
AD(ANTAGE$ AND LIMITATION$
AD(ANTAGE$) The following are the advantages of
,ealth management concept.
+5 Hel*+l In T!, Pl!nn&n# ) The ,ealth management
professional always shows the good path to the customers and
provide the service of ta( planning. Aow to minimi0e the ta(
and save more moneyJ
-5 Hel*+l In $ele't&on o In%estment $tr!te#-) Another
advantage from the customer point of view is with the help of
,/ Frofessional the customer can easily know the investment
strategy and analy0e risk and return.
<5 Hel*+l In Est!te M!n!#ement. ,ith the help of ,ealth
management professional They can also manage their estate.
&state management is a task to provide objective administration
of their funds tailored to aim in responsible distribution and
protection of their overall estate.
.5 Hel*+l &n or/!r0 loo1&n# . They can say planning# that
recogni0es as Their estate grows and changes occurs They
reBuire some team of professionals who help us in future
planning.
4>
;5 Hel*+l or In0&!n E'onom- . anks which are engaged in
business of ,/ earning revenues from the foreign countries i.e.
outsourcing for economy
5@
LIMITATION$
+. WM Re0+'es T"e $'o*e O M!n!#ement ) Though They all
know that management has e(istence at all levels of life and
society but the term ,ealth management only related with the
higher level means rich people# and is not having any plans and
provisions for poor and lower and middle level of society.
-. C"!n'es o Fr!+0 ) Another demerit or limitation of the ,/
concept is it is not showing the actual position. The customer
doesnIt know about the things going on with using his ,ealth
and there may be chances of forgery and fraud with customers.
<. A't+!l P&'t+re ($ Inl!t&on ) ,hat is the actual position of
market they donIt know because every thing is done by some
,/ professionals. So they can not assume Their position in the
market that also results in inflation because economy is
unknown about the actual state. There may be chance that the
customers are in risk but they are showing the false return and
vice*versa.
5?
Cons+mer Po&nt O (&e/ .
We!lt" M!n!#ement
)echnically, PM can *e de2ned as hy*rid service provided *y
portfolio managers, which includes customised stock and
mutual fund investing. Portfolio managers can *e of two kinds,
discretionary or non7discretionary. #iscretionary portfolio
managers manage the funds of clients independently on their
own accord, while the latter manage the funds according to
their clients( direction. Any person who is registered with
ecurities and "xchange Board of $ndia 6e*i- as a portfolio
manager is allowed to o&er PM. A list of these entities can *e
found at ///.se2&.gov.in.
P"S vs :ealt4 anager and fund anager.
PM is completely di&erent from priority *anking and Wealth
management. Priority *anking or Wealth management is the
um*rella of products while PM is a product. o if priority
*anking and Wealth management is a grocery shop then PM
is a speci2c grocery. Priority *anking is usually o&ered to
premiere customers who have a relationship manager
appointed, who would advice you on your investments across
the products o&ered *y the *ank like insurance, and
investment linked products 6mutual funds, *onds and unit
linked insurance plan-.
Mutual funds and PM di&er on the degree of customi+ation,
minimum investment and on the fee structure. Minimum
investment reEuired for PM is more than mutual fund. /nlike
PM, there is no concept of pro2t sharing in mutual funds.
Also, the level of customi+ation of your investments is higher
in PM.
Is P"S for youD
PM is for those people who don(t have the time or the
expertise to do enough research to take informed investment
decisions. $f you have the reEuired time and expertise, then
you don(t need these services. Also, "B$ has prescri*ed a
minimum of :s 3 lakh investment for PM, which means the
service is not for small and medium investors.
:isks involved. )hough PM is a good option for managing
your Wealth, it is not entirely without risk or pain. B.#. a*u,
executive director, Pylon "ngineers 6$ndia-, had opted for
Potak(s PM services. J)hough the relationship manager told
me a*out the commissions and *rokerage fees, he did no
promise any cut7o& or a*solute num*er when asked a*out
returns. )he market was moving up when $ invested and my
money grew to a*out one and half times. But when the market
52
tum*led suddenly, my earnings fell su*stantially.L Ae adds,
J)he company churned the portfolio freEuently, which gave
them two7way pro2t on each transaction, as *rokerage and
pro2t sharing.L a*u now feels it is *etter to understand the
market and invest on your own. Ae withdrew his investments
after ,1 months, even though he got returns of .3 per cent.
!utlook Money tried unsuccessfully to get a response from
Potak ecurities on this episode.
8o$ to c4oose a P"S
$nvestment philosophy. Akhilesh ingh, *usiness head,
"mkay Wealth, says, J)he most important factor is to
understand the fund manager(s investment philosophy and
strategy, which must align with the investor(s o*jectives.L
ingh adds, Jome portfolio managers structure long7term
portfolios, while some prefer to actively churn the portfolio for
higher short7term returns, which adds to the overall cost and
tax lia*ility.L
AB', for instance, has a product called trategic, which is for
the long term, while Angel(s Bluechip is for medium to long7
term investors.
cheme *enchmarks. Make sure that the portfolio is
*enchmarked to an appropriate index. )his helps measure the
performance of the scheme and the portfolio manager.
Benchmarks are important also as pro2t7sharing is linked to
the performance of the portfolio a*ove the *enchmark. o, an
aggressive portfolio *enchmarked to a low7return index will
mean higher over7the7*enchmark returns. )his means that you
will have to share a larger portion of your pro2t. )he wrong
*enchmark distorts the performance of the fund.
Minimum investment.)here are many portfolio
managers whose thresholds are much higher than the e*i7
mandated minimum of :s 3 lakh. 'hoose a scheme that 2ts the
si+e of your portfolio.
:eturns. $t is di@cult to judge a scheme(s performance
*ased on returns, as it may vary from the returns of an
investor. Also, depending on the time of entry, an investor(s
returns may vary from that of others. Before signing the
contract, make sure your portfolio manager has a fair record of
surpassing the returns from the *enchmark index for
numerous years.
$.C. u*ramaniam, '"! and chief investment o@cer, Guantum
Advisors, saysF J)he performance should *e judged over long
periods of time during *oth high and low market levels. )here
should not *e any survivor *ias. )his happens when an
investor withdraws a portfolio due to *ad performance, or a
53
portfolio manager removes a portfolio to show the
performance num*ers of only good portfolios.L
-ost structure.
Portfolio managers usually have two kinds of chargesO
management fee, which is 2xed, and pro2t sharing, which is
varia*le. Qou can also pay a fully 2xed fee. Hurther, if the
portfolio is churned freEuently, it adds to the cost due to
higher tax and *rokerage. !n each transaction you pay
*rokerage and short7term gains tax of .> per cent.
Management fee ranges from scheme to scheme. Qou could opt
for a higher performance7linked charge as it puts pressure on
the fund manager to perform *etter as he has a share in the
pro2ts.
Fre5uency of disclosure.
)his varies from 2rm to 2rm, and largely depends on the
agreement *etween the investor and the company. Most 9ACs
are disclosed daily, *ut you can opt for a company that also
discloses portfolios daily.
Broking house. $f the *roker is internal, it may *e possi*le
that your portfolio is churned freEuently. /sually, asset
management companies have external *rokers, while some,
such as :eligare, have *oth external as Well as internal
*roking.
Assets under management 6A/M-.)hough higher
A/Ms do not guarantee higher returns, it remains an important
factor. A low A/M could *e an indicator of poor performance.
)hey *elieve that :s ,>> core A/M is a healthy Noor.
CONCEPT OF A$$ET CLA$$E$
Asset M&,
Asset mi( is the allocation of a portfolio between asset classes# it
balances return and risk. 'eturns are a combination of the
income from an investment and the price appreciation over the
period. 'isk is usually pro(ied by the 7standard deviation8 of
returns# how much the return changes about the long*term
average.
List Of Different Asset Class
54
?3 8"9e$ $e,os"t
23 M)t)al 8)n$
33 E<)"ty
4 Commo$"t"es
53 At 8)n$
.3 Real-Estate 8)n$
53 %ns)an#e ,o$)#t
:3 St)#t)e$ ,o$)#t
>3 Gol$
?@3C)en#y
??3O"l
Fi.&! D&posits
$>s# are the most popular today.
,ith $>s you deposit a lump sum of money for a fi(ed period ranging
from a few weeks to a few years and earn a pre*determined rate of
interest. $>s are offered by both banks and companies though putting
your money with the latter is generally considered riskier.
/erits and >emerits
The main advantage is that $>s from reputed banks are a very safe
investment because such banks are carefully regulated by the 'eserve
ank of India# 'I# the banking regulator in India.
!ote that company $>s isnIt as safe as bank $>s because if the
company goes bankrupt you may lose your money. /ake sure you
check the credit rating of a company before investing in its $>s. Kou
should be especially wary of companies which offer interest rates
significantly higher than the average to attract your money.
The other advantage of $>s is that you have the option of receiving
regular income through the interest payments that are made every
55
month or Buarter. This option is especially useful for retirees.?n the
flip side# a fi(ed deposit wonIt give you the same returns that you may
get in the stock markets. $or instance a stock*portfolio may rise -1*<1
per cent in a good year whereas a fi(ed deposit typically earns only L*
+1 per cent.
A fi(ed deposit also doesnIt offer protection against inflation. If
inflation rises steeply during the maturity of the $> your inflation
adjusted return will fall.
The rate of interest on $>s varies according to the maturity with longer
deposits generally earning a higher interest rate. Interest paid on a
fi(ed deposit is paid either monthly or Buarterly according to the
investorIs choice. So if you invest 's < lakhs in a one year fi(ed
deposit which pays M per cent you can earn 's -#111 of interest every
month or 's 2#111 of interest every Buarter.
Interest r!tes on FDs
The rate of interest on $>s varies according to the maturity with longer
deposits generally earning a higher interest rate. Aere are the interest
rates offered by I%I%I ank on their $>s. !ote that $>s vary Buite a bit
from bank to bank so you should search around before investing.
Interest paid on a fi(ed deposit is paid either monthly or Buarterly
according to the investorIs choice. So if you invest 's < lakhs in a one
year fi(ed deposit which pays M per cent you can earn 's -#111 of
interest every month or 's 2#111 of interest every Buarter.
Ee't&%e Ret+rn
5.
efore you invest in $>s you need to understand the concept of
effective return which is higher than the rate of interest on the $>.
&ffective return is relevant if you choose to reinvest your interest every
year which means that you will be earning compound interest.
55
5:
MUTUAL FUND
A mutual fund is a professionally managed firm of collective
investments that collects money from many investors and puts it in
5>
stocks# bonds# short*term money market instruments# andDor other
securities.
N+O
The fund manager# also known as portfolio manager#
invests and trades the fundIs underlying securities# reali0ing capital
gains or losses and passing any proceeds to the individual investors.
%urrently# the worldwide value of all mutual funds totals more than
:-2 trillion.
N-O
Since +=.1# there have been three basic types of investment
companies in the 9nited States) open*end funds# also known in the 9S
as mutual fundsP unit investment trusts 49ITs5P and closed*end funds.
Similar funds also operate in %anada. Aowever# in the rest of the
world# mutual fund is used as a generic term for various types of
collective investment vehicles# such as unit trusts# open*ended
investment companies 4?&I%s5# uniti0ed insurance funds# and
undertakings for collective investments in transferable securities
49%ITS5.
0y!es of utual funds
O*en3en0 +n0
The term mutual fund is the common name for what is classified as an
open*end investment company by the S&%. eing open*ended means
that# at the end of every day# the fund issues new shares to investors
and buys back shares from investors wishing to leave the fund.
/utual funds must be structured as corporations or trusts# such as
business trusts# and any corporation or trust will be classified by the
S&% as an investment company if it issues securities and primarily
invest in non*government securities. An investment company will be
classified by the S&% as an open*end investment company if they do
.@
not issue undivided interests in specified securities 4the defining
characteristic of unit investment trusts or 9ITs5 and if they issue
redeemable securities. 'egistered investment companies that are not
9ITs or open*end investment companies are closed*end funds. !either
9ITs nor closed*end funds are mutual funds 4as that term is used in
the 9S5.
E,'"!n#e3tr!0e0 +n0s
A relatively recent innovation# the e(change*traded fund or &T$# is
often structured as an open*end investment company. &T$s combine
characteristics of both mutual funds and closed*end funds. &T$s are
traded throughout the day on a stock e(change# just like closed*end
funds# but at prices generally appro(imating the &T$Is net asset value.
/ost &T$s are inde( funds and track stock market inde(es. Shares are
issued or redeemed by institutional investors in large blocks 4typically
of ;1#1115. /ost investors purchase and sell shares through brokers in
market transactions. ecause the institutional investors normally
purchase and redeem in in kind transactions# &T$s are more efficient
than traditional mutual funds 4which are continuously issuing and
redeeming securities and# to effect such transactions# continually
buying and selling securities and maintaining liBuidity positions5 and
therefore tend to have loTheyr e(penses.
E4+&t- +n0s
&Buity funds# which consist mainly of stock investments# are the most
common type of mutual fund. &Buity funds hold ;1 percent of all
amounts invested in mutual funds in the 9nited States.?ften eBuity
funds focus investments on particular strategies and certain types of
issuers.
.?
C!*&t!l&5!t&on
F+n0 m!n!#ers an$ othe "n!estment ,ofess"onals ha!e !ay"ng $ef"n"t"ons
of m&03'!** an$ l!r#e3'!* anges3 The follo4"ng anges ae )se$ /y
R+ssell In0e,esF
678
R)ssell M"#o#a, %n$e9 - m"#o-#a, 'E543: - 53>35 m"ll"on(
'ussell -111 %n$e9 - small-#a, 'E?:23. m"ll"on - ?3: /"ll"on(
'ussell /idcap %n$e9 - m"$-#a, 'E?3: - ?335 /"ll"on(
'ussell +111 %n$e9 - lage-#a, 'E?3: - 3:.3> /"ll"on(
)on0 +n0s
ond funds account for +M3 of mutual fund asse Types of bond funds
include term funds# which have a fi(ed set of time 4short*# medium*#
or long*term5 before they mature. /unicipal bond funds generally have
loTheyr returns# but have ta( advantages and loTheyr risk. Aigh*yield
bond funds invest in corporate bonds# including high*yield or junk
bonds. ,ith the potential for high yield# these bonds also come with
greater risk.
Mone- m!r1et +n0s
/oney market funds hold -23 of mutual fund assets in the 9nited
States. /oney market funds entail the least risk# as ,ell as loTheyr
rates of return. 9nlike certificates of deposit 4%>s5# money market
shares are liBuid and redeemable at any time. The interest rate Buoted
by money market funds is known as the L >ay S&% Kield.
F+n0s o +n0s
.2
Are mutual funds which invest in other underlying mutual funds 4i.e.#
they are funds comprised of other funds5. The funds at the underlying
level are typically funds which an investor can invest in individually. A
fund of funds will typically charge a management fee which is smaller
than that of a normal fund because it is considered a fee charged for
asset allocation services. The fees charged at the underlying fund level
do not pass through the statement of operations# but are usually
disclosed in the fundIs annual report# prospectus# or statement of
additional information. The fund should be evaluated on the
combination of the fund*level e(penses and underlying fund e(penses#
as these both reduce the return to the investor.
/ost $o$s invest in affiliated funds 4i.e.# mutual funds managed by the
same advisor5# although some invest in funds managed by other
4unaffiliated5 advisors. The cost associated with investing in an
unaffiliated underlying fund is most often higher than investing in an
affiliated underlying because of the investment management research
involved in investing in fund advised by a different advisor. 'ecently#
$o$s have been classified into those that are actively managed 4in
which the investment advisor reallocates freBuently among the
underlying funds in order to adjust to changing market conditions5 and
those that are passively managed 4the investment advisor allocates
assets on the basis of on an allocation model which is rebalanced on a
regular basis5.
The design of $o$s is structured in such a way as to provide a ready
mi( of mutual funds for investors who are unable to or unwilling to
determine their own asset allocation model. $und companies such as
TIAA*%'&$# American %entury Investments# Qanguard# and $idelity
have also entered this market to provide investors with these options
and take the 7guess work8 out of selecting funds. The allocation mi(es
.3
usually vary by the time the investor would like to retire) -1-1# -1<1#
-1;1# etc. The more distant the target retirement date# the more
aggressive the asset mi(.
He0#e +n0s
Aedge funds in the 9nited States are pooled investment funds with
loose S&% regulation and should not be confused with mutual funds.
Some hedge fund managers are reBuired to register with S&% as
investment advisers under the Investment Advisers Act. The Act does
not reBuire an adviser to follow or avoid any particular investment
strategies# nor does it reBuire or prohibit specific investments. Aedge
funds typically charge a management fee of +3 or more# plus a
7performance fee8 of -13 of the hedge fundIs profits. There may be a
7lock*up8 period# during which an investor cannot cash in shares. A
variation of the hedge strategy is the +<1*<1 fund for individual
investors.
"atest Asset <n2er Management for all Mutual 9un2 houses8 sales , re2emption figures..

Amount in 7s. .rores
.4
Mutual 9un2 Name
No. of
Schemes*
Asset <n2er Management
As on .orpus As on .orpus
Net inc=2ec in
corpus
ABN AM7) Mutual
9un2
-5> $un -?8
(??>
58@@-.%@ May -%8
(??>
58?55.-?
@(5.>@/
AIA Alo*al
In'estment Aroup
Mutual 9un2
4/ $un -?8
(??>
-8(?5.(- May -%8
(??>
/8%->.>5
B@-(.5-
Benchmar1 Mutual
9un2
%( 9e* (@8
(??>
/8@4/.C( $an -%8
(??>
485%%.??
B545.(C5
Birla Mutual 9un2
-/> $un -?8
(??>
-C8//5.?? May -%8
(??>
/%8/(5.5/
B-@>?.5/
B)B Mutual 9un2
(( $un -?8
(??>
4-.>5 May -%8
(??>
5/.>-
B%?.@5>
.anara 7o*eco
Mutual 9un2
4@ $un -?8
(??>
-8@%-.54 May -?8
(??>
/8%((.-C
B(?>.C(
DBS .hola Mutual
9un2
C> $un -?8
(??>
(8(/@.45 May -?8
(??>
(8%??.%/
%/@./(
Deutsche Mutual
9un2
%@@ Apr -?8
(??>
%(8C/?.?? Mar -%8
(??>
%%8@@5.??
C//
DSP Merrill "ynch
Mutual 9un2
((5 9e* (@8
(??>
%@8@/?./? $an -%8
(??>
%@8%-5.??
>?/.-@5
!scorts Mutual 9un2
-> Mar -%8
(??>
%C-./( 9e* (@8
(??>
%/5.@-
(5./@%
9i2elity Mutual 9un2
-@ May -%8
(??>
C8>@>.5/ Apr -?8
(??>
>8@/-.-5
B%?//.C(
9ran1lin 0empleton
In'estments
(/% Mar -%8
(??>
(485(%.@C 9e* (@8
(??>
(@8/(/.4>
.5
B->?(.5?C
#D9. Mutual 9un2
-@C 9e* (@8
(??>
/58(@%.@C $an -%8
(??>
/-8C5(.C?
(4(@.(C/
#SB. Mutual 9un2
(?% $un -?8
(??>
%48>/%.%C May -?8
(??>
%C85%C.%%
B%CC4.@-/
I.I.I Pru2ential
Mutual 9un2
//( May -%8
(??>
4@84C-.?> Apr -?8
(??>
4C84C4.?(
%@@>.?5
ID9. Mutual 9un2
(5C $un -?8
(??>
%?8>4@.(> May -%8
(??>
%(84%-./?
B%54/.%(
INA Mutual 9un2
-%- Mar -%8
(??>
>85?>.(@ 9e* (@8
(??>
@8>//.C%
B%(-5./(
$M 9inancial Mutual
9un2
%@% $un -?8
(??>
%?8-5%.-> May -?8
(??>
%%8@>>.@>
B%5(C.5?4
$PMorgan Mutual
9un2
%5 $un -?8
(??>
(8-4%.4% May -%8
(??>
(855?./5
B-?>.@4
ota1 Mahin2ra
Mutual 9un2
%@C May -%8
(??>
(%84>?.5( Apr -?8
(??>
(%8((>.@5
-4%.54@
"I. Mutual 9un2
@- 9e* (@8
(??>
%48%?-.?? $an -%8
(??>
%-8->C./?
%C%4.5?(
"otus In2ia Mutual
9un2
((5 9e* (@8
(??>
@8C5-.>> $an -%8
(??>
%?8?4C.%?
B(@-.(%>
Mirae Asset Mutual
9un2
-5 $un -?8
(??>
(8-C-.(4 May -?8
(??>
(8/--./>
B5?.(-
Morgan Stanley
Mutual 9un2
- $un -?8
(??>
(8C@4.@4 May -?8
(??>
-8/%5.@-
B5(?.@>
P7IN.IPA" Mutual
9un2
%5? $un -?8
(??>
%(8/4?.%C May -%8
(??>
%48C?>.?%
B-(4C.>/
..
Duantum Mutual
9un2
C $un -?8
(??>
5-.?4 May -?8
(??>
54.C%
B(.55
7eliance Mutual 9un2
--5 9e* (@8
(??>
@-84-%.5> $an -%8
(??>
CC8(%?.?/
%5-(%.5->
Sahara Mutual 9un2
/- $un -?8
(??>
%C-.55 May -%8
(??>
%>?.5/
B5.@>
SBI Mutual 9un2
%>% 9e* (@8
(??>
(@8/@(.@C $an -%8
(??>
(C84>%.4/
%@%%./(>
Sun2aram Mutual
9un2
(-- 9e* (@8
(??>
%/8-45.?? $an -%8
(??>
%-8(>4.?/
%?C?.@5
0ata Mutual 9un2
-%/ May -%8
(??>
(/8/C>./4 Apr -?8
(??>
(/8%(%.>5
-45.4>4
0aurus Mutual 9un2
%5 $un -?8
(??>
(5?.5@ May -?8
(??>
-%@.((
B4>.4-
<0I Mutual 9un2
-%@ Mar -%8
(??>
/>8-/C.5? 9e* (@8
(??>
4(8/5/.C%
B/%%C.%%/
* in2icates currently in operation

M<0<A" 9<ND DA0A 9)7 0#! M)N0# !ND!D B MAE -% 8 (??>
Amount in 7s. .rores
.ategory
No. of ne:
schemes
launche2
2uring the
month
Sales 7e2emption
Asset <n2er
Management

Ne:
schemes
!&isting
schemes
0otal 0otal as on
May
-% 8
(??>
as on
Apr -? 8
(??>
Inflo:=
)utflo:
B
Ban1
Sponsore2
? ? 5-@>C 5-@>C 45--? @?C%@ >5C-5 -@>-
. Institutions / %-(> (-@%/ (4(/( %@5>? %>5/@ %5%-5 (4%-
D Pri'ate Sector , $oint Fenture ;
.5
In2ian %( (>-( %/45?? %/>/-( %4/>-- %@?%C? %C(4C% %C4@@
Pre2ominantly
9oreign
> %%?4 4%@%( 4-?%C 4-(5- C-4(4 >(5@C B@%C(
Pre2ominantly
In2ian
%5 -@C@ %(-(54 %(C(// %(5C-? %@(C// %>?55C %(?CC
Aran2 0otal
(BG.GD)
/? @(// /?>5C> /%C@(( /%?>-5 454>?C 4->>?C (C???
.:
.>
5@
E4+&t- &n%estment
Eenerally refers to the buying and holding of shares of stock on a
stock market by individuals and funds in anticipation of income from
dividends and capital gain as the value of the stock rises. It also
sometimes refers to the acBuisition of eBuity 4ownership5 participation
in a private 4unlisted5 company or a startup 4a company being created
or newly created5. ,hen the investment is in infant companies# it is
referred to as venture capital investing and is generally understood to
be higher risk than investment in listed going*concern situations.
D&re't "ol0&n#s !n0 *oole0 +n0s
The eBuities held by private individuals are often held via mutual funds
or other forms of pooled investment vehicle# many of which have
Buoted prices that are listed in financial newspapers or maga0inesP the
mutual funds are typically managed by prominent fund management
firms 4e.g. $idelity Investments or The Qanguard Eroup5. Such
holdings allow individual investors to obtain the diversification of the
fund4s5 and to obtain the skill of the professional fund managers in
charge of the fund4s5. An alternative# usually employed by large
private investors and pension funds# is to hold shares directlyPin the
institutional environment many clients that own portfolios have what
are called segregated funds as opposed to# or in addition to# the
pooled e.g. mutual fund alternative.
5?
Commo0&t&es M!r1et
52
%ommodity markets are markets where raw or primary products are
e(changed. These raw commodities are traded on regulated
commodities e(changes# in which they are bought and sold in
standardi0ed contracts.
This article focuses on the history and current debates regarding global
commodity markets. It covers physical product 4food# metals#
electricity5 markets but not the ways that services# including those of
governments# nor investment# nor debt# can be seen as a commodity.
Articles on reinsurance markets# stock markets# bond markets and
currency markets cover those concerns separately and in more depth.
?ne focus of this article is the relationship between simple commodity
money and the more comple( instruments offered in the commodity
markets.
ART FUND
,ealth management now includes art# real estate investments.
,ITA prices of paintings rising +1 times in the last two years# three
new financial entities have launched Rart advisoryI services as part of
,ealth management services. ,hile %itibank has been providing art
advisory services like art insurance# art storage and using art as a
tradable collateral for some time# the recent surge in prices has driven
Kes ank# A! Amro and >awnay >ay to start this service.
The works of /.$. Aussain# Satin >as or Anjolie &la /enon are sought
after by art lovers not only for their aesthethic value but also as an
asset. Art galleries are involved in art valuations# i.e. mapping the
pricing history of an artist or research on art.
53
Art is now being treated as an investment and high net worth
individuals are prompting banks to look at alternative asset classes#
such as art or real estate# for investment as a part of ,ealth
management products.
D&%ers&&e0 *ortol&o
Individuals looking at alternative investments rather than the usual
investments in eBuity*related products.
7Investments in alternative asset classes give clients a diversified
portfolio across a variety of asset classes#8
Kes ank is e(pected to launch a ,ealth management service that will
offer investment in real estate# art and je,ellery. It e(pects to kick*
start the real estate service during this fiscal.
7The bank is planning tie*ups with real estate consultant agencies. The
service will largely cater to non*resident Indians seeking opportunities
to invest in real estate in the country#8.
T&e3+*s /&t" #!ller&es
In the art segment# tie*up with art galleries. 7%ontemporary Indian art
will be at focus. The hiring specialists in the field for advisory#8 Aigh
networth individuals in India are increasingly looking at contemporary
Indian art as a good investment. ,ith the advent of private art funds
and galleries# art is becoming an emerging asset class.
A! Amro advises clients on investment in art. Aowever# the e(ecution
depends on the client in conjunction with e(perts in the field.
54
It is difficult to generalise. The majority of clients begin with an
investment of around .*; per cent of their portfolio#8 targets customers
with 's -*-.; crore threshold for investment.
According to the banks# some clients also invest in these asset classes
to minimise risk because they are looking at protecting their capital.
Investment in these asset classes reBuires a review of clientIs age#
personal ability to take risk and most importantly# clientIs interest.
,hat percentage of assets would be allocated to alternative assets
would depend on the clientIs interest and ability to take risk.
REAL E$TATE FUND
India 'eal &state $und is a significant component of the Indian realty
market flooded with Indian and foreign financial institutions. The
growing increase in the industrial# commercial and residential projects
have boosted the real estate market in India. This has thrown open
unlimited scope for the incoming of the India 'eal &state $unds. The
profits have encouraged financial assistance from not only domestic
funds but also lured many foreign investors to participate in the India
'eal &state $und.
The cooperating assistance from the government has further
encouraged liBuidity flow into the India real estate market sector. The
foreign contributions in the India 'eal &state $und have been
witnessing a steady rise of .13*.;3 per year. The domestic financial
institutions have also build up their investments like their foreign
counterparts. This combined participations from both along with
contributions of the corporate houses has accelerated the growth of
India 'eal &state $und.
55
Le!0&n# In0&! Re!l Est!te F+n0.
Some of the leading India 'eal &state $und are )
+. A>$% Froperty $und* A>$% India 'eal &state $und 4AI*'&$5# the
first scheme A>$% Froperty $und# invest in all the stages of the
real estate projects.
-. >A$@ Qenture %apital $und* >A$@ Qenture %apital $und#
promoted by >ewan Aousing# has a focus on developing
properties rather than investing in real estate.
<. "shitij Qenture %apital $und * "shitij Qenture %apital $und# a
group venture of Fantaloon 'etail India @td.# will be deploying
funds e(clusively in developing malls specially in western and
southern India.
.. India Advantage $und 4I%I%I5
;. "otak /ahindra 'ealty $und
9 In0&! Re!l Est!te M+t+!l F+n0.
The further involvement of the real estate mutual funds have improved
the Buality of the construction practices. The +1
th
$ive*Kear Flan has
proposed that Securities and &(change oard of India would regulate
the India real estate mutual funds.
5.
9 Re!l Est!te In%estment Tr+sts.
The primary difference between 'eal &state Investment Trusts and a
mutual fund is that investments made in the former are traded in real
estate stocks and not invested in company stocks moreover they
provides a heavier liBuidity than the mutual funds.
9 In0&! Re!l Est!te Fore&#n F+n0s3
The significant international investments in the India 'eal &state $und
are like)
+.,arburg Fincus
-.lackstone Eroup
<.roadstreet
../organ Stanley 'eal &state $und
;.%olumbia &ndowment $und
2.Aines
L.Tishman Speyer
M.Sam GellIs &Buity International
55
Ins+r!n'e Pro0+'t
5:
The modern concept of insurance practices in India started during the
ritish rule in +M+M when ?riental @ife Insurance %ompany was
established in %alcutta. India became independent from ritish rule in
+=.2# and by +=;2 the insurance sector was nationali0ed# with the @ife
Insurance %orporation of India created by combining almost -.;
private life insurance companiesP +1L private non*life companies
combined in +=L< to form the Eeneral Insurance %orporation. ut
since the very purpose of nationali0ing the insurance sector got
sidelined due to the monopolistic power it enjoyed# coupled with the
bureaucratic mindset of @I% and EI%# insurance again was opened to
private players in +===. >uring -111*-112# almost +; life and +< non*
life private insurance players 4mostly joint ventures between Indian
and foreign players5 started operations in India# indicating the
willingness of foreign institutional investors to enter the Indian
insurance sector. ut through all these major changes the actual
impact was felt only in major urban areas# while the vast majority of
the rural population was e(cluded from the insurance sector. Around
the world# scholars and financial e(perts believe that in the ne(t ; to
+1 years# India and %hina are going to be the targets for insurance
companies. So far# most of the insurance companies in India are not
actively tapping the huge potential of the rural markets. 9nless the
rural markets are given priority consideration# all predictions about
future insurance industry potential in India are going to be distant
dreams. The present insurance business is not even able to penetrate
-13J<13 of the total population of +.1=; billion# and the projected
population figure by -1-; will be appro(imately +.;1+ billion. The
order of the day will be to refocus on micro insurance in India to
capture the huge potential of rural customers 9nit @inked Insurance
Flan 49@IF5 provides for life insurance where the policy value at any
time varies according to the value of the underlying assets at the time.
5>
9@IF is life insurance solution that provides for the benefits of
protection and fle(ibility in investment. The investment is denoted as
units and is represented by the value that it has attained called as !et
Asset Qalue 4!AQ5.
9@IF came into play in the +=21s and is popular in many countries in
the world. The reason that is attributed to the wide spread popularity
of 9@IF is because of the transparency and the fle(ibility which it
offers.
As times progressed the plans Theyre also successfully mapped along
with life insurance need to retirement planning. In todayIs times# 9@IF
provides solutions for insurance planning# financial needs# financial
planning for childrenIs marriage planning also can be done with this.
$tr+'t+re0 Pro0+'t
A structured product is generally a pre*packaged investment strategy
which is based on derivatives# such as a single security# a basket of
securities# options# indices# commodities# debt issuances andDor
foreign currencies# and to a lesser e(tent# swaps. The variety of
products just described is demonstrative of the fact that there is no
single# uniform definition of a structured product. A feature of some
structured products is a 7principal guarantee8 function which offers
protection of principal if held to maturity. $or e(ample# an investor
invests +11 dollars# the issuer simply invests in a risk free bond which
has sufficient interest to grow to +11 after the ; year period. This bond
might cost M1 dollars today and after ; years it will grow to +11
dollars. ,ith the leftover funds the issuer purchases the options and
swaps needed to perform whatever the investment strategy is.
Theoretically an investor can just do this themselves# but the costs and
:@
transaction volume reBuirements of many options and swaps are
beyond many individual investors.
As such# structured products were created to meet specific needs that
cannot be met from the standardi0ed financial instruments available in
the markets. Structured products can be used as an alternative to a
direct investment# as part of the asset allocation process to reduce risk
e(posure of a portfolio# or to utili0e the current market trend.
Com*os&t&on
Structured products are usually issued by investment banks or
affiliates thereof. They have a fi(ed maturity# and have two
components) a note and a derivative. The derivative component is
often an option. The note provides for periodic interest payments to
the investor at a predetermined rate# and the derivative component
provides for the payment at maturity. Some products use the
derivative component as a put option written by the investor that gives
the buyer of the put option the right to sell to the investor the security
or securities at a predetermined price. ?ther products use the
derivative component to provide for a call option written by the
investor that gives the buyer of the call option the right to buy the
security or securities from the investor at a predetermined price.
:?
R&s1s
The risks associated with many structured products# especially those
products that present risks of loss of principal due to market
movements# are similar to those risks involved with options. The
potential for serious risks involved with options trading are well*
established# and as a result of those risks customers must be e(plicitly
approved for options trading.
GOLD
F!'tors &nl+en'&n# t"e #ol0 *r&'e
Today# like all investments and commodities# the price of gold is
ultimately driven by supply and demand# including hoarding and
disposal. 9nlike most other commodities# the hoarding and disposal
plays a much bigger role in affecting the price# because most of the
gold ever mined still e(ists and is potentially able to come on to the
market for the right price. Eiven the huge Buantity of hoarded gold#
compared to the annual production# the price of gold is mainly affected
by changes in sentiment# rather than changes in annual production.
According to the ,orld Eold %ouncil# annual mine production of gold
over the last few years has been close to -#;11 tonnes. About <#111
tonnes goes into jewelry or industrialDdental production# and around
;11 tonnes goes to retail investors and e(change traded gold funds.
This translates to an annual demand for gold to be +111 tonnes in
e(cess over mine production which has come from central bank sales
and other disposal.
:2
%entral banks and the International /onetary $und play an important
role in the gold price. At the end of -11. central banks and official
organi0ations held += percent of all above*ground gold as official gold
reserves. The ,ashington Agreement on Eold 4,AE5# which dates
from September +===# limits gold sales by its members 4&urope#
9nited States# Sapan# Australia# ank for International Settlements and
the International /onetary $und5 to less than .11 tonnes a year.
&uropean central banks# such as the ank of &ngland and Swiss
!ational ank# have been key sellers of gold over this period.
Although central banks do not generally announce gold purchases in
advance# some# such as 'ussia# have e(pressed interest in growing
their gold reserves again as of late -11;. In early -112# %hina# which
only holds +.<3 of its reserves in gold# announced that it was looking
for ways to improve the returns on its official reserves. /any bulls
hope that this signals that %hina might reposition more of its holdings
into gold in line with other %entral anks.
In general# gold becomes more desirable in times of)
Ban1 failures
When $ollas 4ee f)lly #on!et"/le "nto gol$* /oth 4ee ega$e$ as money3
Ho4e!e* most ,eo,le ,efee$ to #ay ao)n$ ,a,e /an+notes athe than the
some4hat hea!"e an$ less $"!"s"/le gold coins3 %f ,eo,le feae$ the" /an+
4o)l$ fa"l* a bank run m"ght ha!e /een the es)lt3 Th"s "s 4hat ha,,ene$ "n the
7SA $)"ng the Ereat >epression of the ?>3@s* lea$"ng Fresident
'oosevelt to "m,ose a nat"onal emegen#y an$ to o)tla4 the hol$"ng of gol$ /y
7S #"t"2ens +no4n as &(ecutive ?rder 2+1- 4h"#h has s"n#e /een en$e$3
"o: or negati'e real interest rates
%f the et)n on /on$s* e<)"t"es an$ eal estate "s not a$e<)ately #om,ensat"ng fo
"s+ an$ "nflat"on then the $eman$ fo gol$ an$ othe altenat"!e "n!estments s)#h
as #ommo$"t"es "n#eases3 An e9am,le of th"s "s the ,e"o$ of Stagflation that
o##)e$ $)"ng the ?>5@s an$ 4h"#h le$ to an economic bubble fom"ng "n
precious metals3
War8 in'asion8 looting8 crisis
:3
%n t"mes of nat"onal #"s"s* ,eo,le fea that the" assets may /e se"2e$ an$ that the
#)en#y may /e#ome 4othless3 They see gol$ as a sol"$ asset 4h"#h 4"ll al4ays
/)y foo$ o tans,otat"on3 Th)s "n t"mes of geat )n#eta"nty* ,at"#)laly 4hen
4a "s feae$* the $eman$ fo gol$ "ses3
:4
Currency
)he modern hedge fund manager(s li*eral tongue7in7cheek
de2nition isF J$f it moves up and down independently, then it(s
an asset class.L While currencies surely do a lot of moving up
and down, they also stand out for other reasonsF
The glo/al foe"gn-e9#hange '8D( ma+et #an /e #ons"$ee$ /y fa the lagest
ma+et,la#e "n the 4ol$* not only geoga,h"#ally /)t also 4"th efeen#e to ta$"ng
!ol)me3 The $a"ly t)no!e "s go4"ng #onstantly an$ has long ago s),asse$ the E?
t"ll"on ma+F foty t"mes the s"2e of 4ol$ ta$e3
An "m,otant $"ffeen#e /et4een #)en#"es an$ othe ma+ets "s that #)en#y ,"#es
allo4 )s to analyse also the"
e#",o#al !al)es3 A fall"ng $ollaGyen "s synonymo)s 4"th a "s"ng yen /e#a)se the
$olla #an /e e9,esse$ "n yen an$* !"#e !esa* the yen "n $ollas3 =y #om,a"son* the
$olla "s ne!e meas)e$ "n )n"ts* as the 1o4 Iones fo e9am,le3
8o the same eason the e9,ess"on Jshot saleH K so m)#h mal"gne$ "n e<)"ty ta$"ng
K $oes not e9"st "n #)en#y ta$"ng /e#a)se the shot sale of a #)en#y "s e<)"!alent
to a ,)#hase of the othe #)en#y3
8o s"m"la easons* the #)en#y ma+et #annot s)ffe a J#ashH 's)#h as the sto#+
ma+et #ashes of ?>2> o ?>:5( tho)gh 4h"#h the 4ealth of all ma+et ,at"#",ants
$4"n$les3 %n the #)en#y ma+et ea#hloss "s mat#he$ /y an e<)"!alent ga"n of the
#o)nte-,aty3
Anothe )n"<)e feat)e of the #)en#y ma+et "s that "t "s a#t"!e 4"tho)t "nte),t"on
Jo)n$-the-#lo#+H3
:5
Portol&o 'om*os&t&on o '+rren'-
Modern portfolio theory postulates that relative risk can *e
reduced *y diversi2cation into at least six or more
components. )his is not necessarily true for currency
portfolios. Most delivering percentage returns. )he index
serves as a proxy for availa*le currency manager portfolio
returns in general and has the added *ene2t of *eing
uncorrelated to returns of other asset classes. 8ow correlation,
liEuidity and transparency are good enough reasons for
currencies to *e considered a prime candidate for inclusion in
any investment portfolio.
:.
:5
::
-o!anies Providing :ealt4 "anageent Services
Kotak securities
IN07)D<.0I)N
is handling Wealth management department with a name of
Potak portfolio management.
P7)D<.0S
GEMS &otfol"o
O"g"n
Sele#t &otfol"o
Sele#t O,t"ma
Klass"# &otfol"o - 8le9"
%n!estg)a$ &otfol"o
Coe &otfol"o
NR%
)hey are providing a*ove products according to the customer
reEuirement. )he a*ove products are varying to high risk
customers to low risk customers with a time origin of
investment .)hey have a separate service for 9:$ asset
management service.
ASS!0 ."ASS!S <S!D
1"e#t E<)"ty
M)t)al f)n$s
St)#t)e$ ,o$)#ts
%ns)an#e ,o$)#ts
8"9e$ $e,os"ts3

:>
Asset SiHe
It is also one of t4e largestA $it4 Assets /nder
"anageent of over #s. 33** -rores.
INF!S0M!N0 P#I")SP#E
!ur mission is to provide clients with wealth management
services that result in a performance that meets or exceeds
their investment goals. "xposing our clients to undue risk is
contrary to this mission. We *elieve that the tools of Modern
Portfolio )heory empower us with a methodology for *uilding
superior investment portfolios. )his has *een tested in all
types of market conditions for decades and has consistently
protected investor wealth from the perils of non7
diversi2cation.
Mor#!n $t!nle-
INTRODUCTION
/organ Stanley is a leading global financial services firm providing a
wide range of investment banking# securities# investment management
and ,ealth management services. The $irmIs employees serve clients
worldwide including corporations# governments# institutions and
individuals from more than 211 offices in << countries
/utual $und has a uniBue investment team model# best described as a
R%ommunity of outiBuesI# which aims to ensure that each investment
strategy is managed by a dedicated team with specific e(perience in
that strategy.
/organ Stanley which has been active in the country since +==< and is
seeking to develop an integrated platform in India# which encompasses
the full range of businesses the $irm conducts globally.
PRODUCT$
>@
@arge %ap Erowth &Buity with Sridhar Sivaram and Amay
Aattangadi as @ead Fortfolio /anagers.
/ultiD/id cap &Buity with Sayesh Eandhi as @ead Fortfolio
/anager.
/ulti*Strategy with !avneet /unot as @ead Fortfolio /anager.
/organ Stanley A.%.&. 4Across %apitalisations &Buity5 $und# an
open*ended eBuity scheme managed by Sayesh Eandhi# was
launched in $ebruary# -11M as the first fund open ended offering
of /organ Stanley /utual $und in India.
A$$ET CLA$$E$ U$ED
M)t)al f)n$s
St)#t)e$ ,o$)#ts
%ns)an#e ,o$)#ts
8"9e$ $e,os"ts3
Asset s&5e
The India /agnum $und# an offshore fund set up in +=M=# marked the
entry of /organ Stanley in the Indian market. In +==.# /organ
Stanley launched its first domestic fund# /organ Stanley Erowth $und
4/SE$5. As of >ecember <+# -11L# /organ Stanley 's .<M1 crores in
assets under management.
/organ Stanley Investment /anagement# together with its investment
advisory affiliates# has nearly +111 investment professionals around
the world and appro(imately 9S:;LL billion in assets under
>?
management or supervision as of $ebruary -=# -11M. y leveraging its
global Rcommunity of boutiBuesI structure and the strength of /organ
Stanley# /SI/ strives to provide outstanding long*term investment
performance# service and a comprehensive suite of investment
management solutions to a diverse client base# which includes
governments# institutions# corporations and individuals.
>2
IN(E$TMENT PHILO$PHY
we use a strict value*investment methodology. ,e believe this to be
the best way to generate consistently strong returns# whilst minimi0ing
risks for our clients. Qalue Investing has outperformed the stock
markets consistently for more than M1 years. It is a very research*
intensive discipline and eschews future projections# focusing instead on
what is the intrinsic value of a company today.
,ealth /anagement runs focused portfolios comprising +;*-; stocks.
,e are only interested in the best value companies in the entire
market. ?ur goal is to find companies that offer a substantial R/argin
of SafetyI# which both reduces the risk of losses# whilst allowing for
superior returns.
Mot& L!l Os/!l We!lt" M!n!#ement
IN07)D<.0I)N
$n today(s complex 2nancial environment, investors have
uniEue needs which are derived from their risk appetite and
2nancial goals. But regardless of this, every investor seeks to
maximi+e his returns on investments without capital erosion.
While there are many investment avenues such as 2xed
deposits, income funds, *onds, eEuities etcR. $t is a proven
fact that "Euities as an asset class typically tend to outperform
all other asset classes over the long run.
$nvesting in eEuities, reEuire knowledge, time and a right
mind7set. "Euity as an asset class also reEuires constant
monitoring may not *e possi*le for you to give the necessary
time, given your other commitments.
)hey recogni+e this, and manage your investments
professionally to achieve speci2c investment o*jectives, and
not to forget, relieving you from the day to day hassles which
investment reEuire.
>3
P7)D<.0S
Bal)e &otfol"o
=)llHs Eye &otfol"o
Ne9t T"ll"on 1olla O,,ot)n"ty &otfol"o
ASS!0 ."ASS!S <S!D
1"e#t E<)"ty
M)t)al f)n$s
St)#t)e$ ,o$)#ts
%ns)an#e ,o$)#ts
8"9e$ $e,os"ts
>4
Asset $&5e
Motilal !swal ecurities 8td *rings with more than . decades
of experience % expertise in eEuity research and stock
*roking. )hey are one of the leading portfolio service
providers, with asset under management worth :s. 34> 'rores
In%estment *"&loso*"-
,e have established a disciplined and dynamic investment process
that is rooted in the premise that asset allocation and investment style
diversification are the most critical determinants in achieving
consistent investment returns with acceptable levels of risk.
?ur investment process is solid and consistent at its core# yet dynamic
in its application. The premise# as outlined above# remains constant. At
the same time# we continually update its application for the most
current economic climate so as to keep our investment
recommendations up*to*date and relevant. Additionally# when applied
to each clientIs portfolio# the process accommodates that clientIs
specific situation# time hori0on# risk tolerance# and other factors so
that the result is a truly customi0ed portfolio.
>5
Rel&#!re We!lt" M!n!#ement
INTRODUCTION
Wealth Spectrum
Portfolio management
Art Intiative
Priority Client Equity Service
In The continuous endeavour to provide the best of the product and
services to the clients# it The 'eligare and /acBuarie are now ;1);1
Soint venture partners in the newly created entity 'eligare /acBuarie
,ealth /anagement @imited.
The new entity is testimony to 'eligareIs firm commitment to all its
businesses wherein# it believes in offering nothing short of the very
best to its clients and the end consumers. In order to do so# it believes
in creating and delivering value by either going solo or by leveraging
relevant and meaningful partnerships with global majors and domain
specialists. They believe that this joint venture with /acBuarie is a
marriage of strengths that combines the sharp understanding# insights
and e(ecution capabilities of 'eligare in the Indian conte(t with the
global e(pertise of /acBuarie.
The new brand for the venture*'eligare /acBuarie Frivate ,ealth shall
strive to proactively manage their ,ealth and is hungry and keen to
bring about a much needed refreshingly different paradigm shift in the
Indian market place.
>.
'eligare /acBuarie Frivate ,ealth shall draw strength and its core
essence from the values of 'eligareIs 7>iligence8 and /acBuarieIs
7$orward Thinking8.
PRODUCT$ .
Panther
Tortoise
Elephant
Caterpillar
Leo
Panther
The Fanther portfolio aims to achieve higher returns by taking
aggressive positions across sectors and market capitali0ations. It is
suitable for the 7Aigh 'isk Aigh 'eturn8 investor with a strategy to
invest across sectors and take advantage of various market conditions.
Tortoise
The Tortoise portfolio aims to achieve growth in the portfolio value
over a period of time by way of careful and judicious investment in
fundamentally sound companies having good prospects. The scheme is
suitable for the 7/edium 'isk /edium 'eturn8 investor with a strategy
to invest in companies which have consistency in earnings# growth and
financial performance.
Elephant
>5
The &lephant portfolio aims to generate steady returns over a longer
period by investing in Securities selected only from S& +11 and !S&
+11 inde(. This plan is suitable for the 7@ow 'isk @ow 'eturn8 investor
with a strategy to invest in blue chip companies# as these companies
have steady performance and reduce liBuidity risk in the market.
Caterpillar
The %aterpillar portfolio aims to achieve capital appreciation over a
long period of time by investing in a diversified portfolio. This scheme
is suitable for investors with a high risk appetite. The investment
strategy would be to invest in scrips which are poised to get a re*
rating either because of change in business# potential fancy for a
particular sector in the coming yearsDmonths# business diversification
leading to a better operating performance# stocks in their early stages
of an upturn or for those which are in sectors currently ignored by the
market.
Leo
@eo is aimed at retail customers and structured to provide medium
to long*term capital appreciation by investing in stocks across the
market capitali0ation range. This scheme is a mi( of moderate and
aggressive investment strategies. Its aim is to have a balanced
portfolio comprising selected investments from both Tortoise and
Fanther. &(posure to >erivatives is taken within permissible
regulatory limits.
>:
A$$ET CLA$$E$ U$ED .
&Buities 4Including International5
>ebts
%ommodities
Structured Froducts
&merging Investment %lasses.
'eligare Arts Initiative 4'AI5
Rel&#!re Arts In&t&!t&%e :RAI;
The Indian arts Industry is currently valued as one of the growing
industries of the world market. Art prices in India are escalating every
year.
The 'eligare Arts Initiative is a venture of 'eligare &nterprises @imited
with a view to provide a Buality platform and infrastructure for Arts.
This initiative has been envisioned as a true champion 7for the cause
of arts8.
The 'AI will provide a platform for artists of all ages# genres# and
statures. They are already in the process of creating a transparent and
highly rich infrastructure that would involve cataloguing#
documentation# art research# and the development of an art aesthetic
on an institutional basis. 'AI will work closely with the Indian art and
design schools on the issues such as the curriculum and resources to
>>
bring them into the same Buality domain as their international
counterparts.
'AIIs envisaged activities include building infrastructure for arts#
creation of an arts awareness program# creation of spaces D canvases
for the artists# creation of International Buality Eallery Spaces#
providing Art Advisory Services and much more.
A$$ET $I<E .
's. .+1 cr.
In%estment P"&loso*"-
They believe that investors are better served by a disciplined
investment approach# which combines an understanding of the goals
and objectives of the investor with a fine tuned strategy backed by
research.
Stock specific selection procedure based on fundamental
research for making sound investment decisions.
$ocus on minimi0ing investment risk by following rigorous
valuation disciplines.
%apital preservation.
Selling discipline and use of >erivatives to control volatility.
?@@
$t!n0!r0 '"!rtere0
IN07)D<.0I)N
Friority anking 6 personalised ,ealth management program at
Standard %hartered ank. It is their endeav their to be the 'ight
Fartner in all their personal and business ventures. ThatIs why Friority
anking has been tailored to offer you the highest level of service#
appropriate to your uniBue reBuirements and status.
PRODUCT$ .
E."&$ 'a)(i)%
In todayIs fast moving# technology*driven world# you need your bank
to keep pace with your banking needs. ThatIs why you need &(cel
anking * a much personalised ,ealth management service that has
been designed to help you make the most of your money# without
taking up most of your time.
,ith the services of their personal 'elationship /anager customer
can access complete ,ealth management solutions# from routine
banking and transaction management to more comple( investment
services and insurance advisory services.
,hatIs more# you also get fee waivers on premium savings and
current accounts and preferred pricing on a range of complementary
banking products and services.
?@?
Aere are the uniBue features of &(cel anking)
A##ess to a ,esonal Relat"onsh", Manage
E9#l)s"!e ,"!"leges s)#h as a fee gol$ #a$* fee $e/"t #a$s an$ $"s#o)nts on
lo#+es* $emat a##o)nts an$ o!e$aft aga"nst tem $e,os"ts
8ee m)lt"-#"ty #he<)e /oo+ fo #)ent a##o)nt an$ sa!"ngs a##o)nt hol$es
E9,ess #he<)e #olle#t"on an$ nat"onal #lea"ng s,ee$ se!"#e
8ee $emat a##o)nt
E9ten$e$ /an#h ho) fo eas"e an$ <)"#+ tansa#t"ons
Re$"e#t"on of "nteest "nto any a##o)nt s,e#"f"e$ /y yo)
&hone =an+"ng an$ ATM fa#"l"t"es fo 24 ho) a##ess
Pari-aar A""o#)t
Farivaar is a uniBue ,ealth /anagement Solution from Standard
%hartered ank that offers your family fle(ibility# convenience and
essential tools for ,ealth accumulation and preservation.
&a"!aa "s m)#h moe than a eg)la Sa!"ngs A##o)nt3 %t allo4s yo) ma"nta"n
yo) "n$"!"$)al "$ent"ty 4h"le allo4"ng yo) to ta, yo) fam"lyHs f"nan#"al stength3
Hee ae some of the feat)es of the &a"!aa sa!"ngs a##o)nt F
Co) fam"ly #an ma"nta"n "n$"!"$)al sa!"ngs a##o)nts 4"th the /enef"t of
#l)//"ng /alan#es "n go),e$ a##o)nts3
Anyt"me* any4hee a##ess to a##o)nts tho)gh ATMs* &hone =an+"ng an$
Onl"ne =an+"ng3
Glo/ally !al"$ ATM-#)m-$e/"t #a$ #an /e )se$ at 3*2.*@@@ me#hant o)tlets "n
%n$"a an$ ?4 m"ll"on o)tlets 4ol$4"$e3
ASS!0 ."ASS!S <S!D ;
&Buities
>ebts
/utual funds.
?@2
%ommodities
Structured Froducts
ASS!0 SII! ;
:ealt4 "anageent De!artent 4as asset under
anageent is #s.&)* -r.
?@3
INF!S0M!N0 P#I")SP#E;
,e have developed a different and more focused approach to wealth
management. 9nderstanding that wealth means different things to
different people# we believe that no one is better placed to help you
acBuire wealth and grow it# use and enjoy it# protect it and pass it on.
?ur appreciation that every investor is comple( and different and can
have comple( needs# has led us to our development of a highly
innovative new approach that we call our investment philosophy. ,e
believe it radically improves the management of private client
investments.
?ur investment philosophy uses sophisticated profiling and portfolio
construction techniBues to aim for investments that deliver market*
leading performance in the way you want# because while performance
is key# it is performance that suits you that really matters.
Ferformance that reflects your attitudes and personality and gives you
the confidence and reassurance to make decisions with clarity and
speed.
ABN AM7) W!A"0# MANAA!M!N0
AB9 AM:! 9:$ ervices, under the aegis of Can 5ogh
preferred *anking *rings to you a personali+ed and
comprehensive solution through )heir exclusive Wealth
Management ervices. )hey will help you preserve and
enhance your Wealth generated in $ndia and a*road with a
range of exclusive $nvestment and $nsurance solutions.
AB9 AM:! Asset Management is the separately organised
investment management division of AB9 AM:! Bank. AB9
AM:! Asset Management is headEuartered in 8ondon and
Amsterdam with other main units in Atlanta, 'hicago, Aong
Pong and ingapore. $t has signi2cant experience in managing
money for over .>>> institutional clients including central
*anks, pension funds, insurance companies and other
institutions. $n addition to managing funds for institutional
clients, AB9 AM:! Asset Management o&ers tailored
?@4
investment management services to private clients. $t employs
.>>> people worldwide in over 0> countries, with portfolio
managers and analysts located around the world. All
investment products *ene2t from the valua*le sourrce of local
expertise, while portfolios are often managed locally. )his local
knowledge is used as input for international co7ordination of
the investment policy.
AB9 AM:! Asset Management(s approach to full7service
investment management underlines )heir commitment to long7
term client relationships. )hey *elieve that excellence can only
*e achieved when investment performance and risk
management are com*ined with high7Euality client servicing.
)heir goal is to add value *y o&ering risk7controlled
outperformance in the context of speci2c *enchmarks and
investment hori+ons of their investors.
?@5
P7)D<.0S
IN/ESTMENT SER/ICES F )hey recogni+e 2nancial needs vary and
there is no Jone7si+e72ts allL approach. AB9 AM:! $nvestment
ervices *rings to you an unmatched *lend of personali+ed
services and an array of innovative and exclusive products
suited for each of your investment needs. Whether you are in
$ndia or a*road, )hey extend )heir hand of partnership as your
trusted 2nancial advisors.
)heir expert $nvestment 'ounselors ensure that your individual
risk pro2le is drawn so that )hey can cater to your speci2c and
precise investment needs. !ptimal asset allocation among a
wide range of investment products helps to create a portfolio
*est suited to your reEuirements and preferences, while
maintaining the *est *alance *etween risk and return

$9/:A9'" ":C$'" F Being away from $ndia
doesn(t mean you have to compromise the safety and security
of your loved ones. $n fact, your savings from your time
overseas can easily *e channelised to meet your family(s
needs for today and in the future. AB9 AM:! $nsurance
ervices *rings to you an unrivalled com*ination of steady
returns with minimum risk.
Qour insurance plans will provide your family the added
2nancial security in case of an unforeseen exigency. )hese
investment cum protection plans can help you create Wealth
for funding your long term needs like education and marriages
of your children and creating your retirement corpus. )hey
o&er you a world of choice in insurance that can *e customi+ed
to meet your individual needs.
ASS!0 ."ASS!S <S!D
Expertise In All Asset Classes
As a glo*al, full7service investment manager, they o&er their
*road customer *ase capa*ilities in all major asset classes,
and a spectrum of products including *oth fundamentally
driven investment approaches and more Euantitative
investment processes.
AB9 AM:! Asset Management has signi2cant experience in
managing money for consumers as well as for institutional
clients including central *anks, pension funds, insurance
companies and other institutions.
ASS!0 SII!
?@.
/S E4*.4*cr
INF!S0M!N0 P#I")SP#E
O+r &n%estment *"&loso*"- t!1es root &n t"e 2el&e t"!t
+n0!ment!l rese!r'" !s !n &n%estment *ro'ess -&el0s ret+rns
!n0 "en'e /e l!- em*"!s&s on 'om*!n- s*e'&&' rese!r'". T"e
+n0erl-&n# *r&n'&*les t"!t "el* +s orm+l!te t"e &n%estment
*ro'ess. In%estments !re m!0e &n =2+s&nesses=> !n0 not
='om*!n&es=>? t"e l!tter &s @+st !n !%en+e. Com*!n&es :/&t"&n
t"!t 2+s&ness; t"!t '!n #ener!te ret+rns on '!*&t!l &n e,'ess o
t"e&r 'ost o '!*&t!l o%er ! 2+s&ness '-'le !re *reerre0.
E!rn&n#s #ro/t" o ! 'om*!n- &s t"e *r&me 0r&%er !n0 o%er !
*er&o0 o t&me t"e sto'1 *r&'e o t"e 'om*!n- s"!ll 2e ! sl!%e o
t"e s!me. Hen'eA &n%estments &n sto'1s !re to 2e m!0e !t
re!son!2le %!l+!t&ons. O/n 'om*!n&es t"!t '!n #ener!te lon#3
termA s+st!&n!2le e!rn&n#sA m!n!#e0 2- 4+!l&&e0 *roess&on!ls
'!*!2le o e,e'+t&n# ! /ell 'on'e&%e0 str!te#&' *l!n
H$)C F&n!n'&!l Pl!nn&n# $er%&'es
your portfolio can be managed in a fully discretionary manner from a
selection of Rest of reedI third party panel of Fortfolio /anagement
Service providers.
The main objective is to help you to preserve your wealth in line with
your investment objectives.
$nNation, falling interest rates and Nuctuating market
conditions reEuire you to plan your 2nances carefully.
'ele*rate important occasions in the future *y managing your
Wealth Well now. AB'(s Hinancial Planning ervices o&er
assistance to secure your future.
)heir Hinancial Planning ervices are availa*le for existing
AB' customers and are free of cost.
8aunched in $ndia in 9ovem*er .>>., AB' $nvestments
manages assets of over $9: ,>,<;1 crores, spread across .,
?@5
schemes and plans under the AB' Mutual Hund um*rella, as
of end August .>><. AB' $nvestments has also soft7launched
AB' Alpha Account, the Portfolio Management services 6PM-
Business to manage wealth for Aigh 9et worth $ndividuals.
'urrently, the PM *usiness o&ers two product *askets,
namely, the
?@:
P7)D<.0S
S"gnat)e &otfol"o
Stateg"# &otfol"o3
ASS!0 ."ASS!S <S!D
Tra!itio)a$ i)-&stm&)ts :
irect Equity A!visory " 'ustomi+ed advice on direct eEuity
portfolios *ased on your risk pro2le and speci2c reEuirements.
)he proposition, *acked *y comprehensive in7house research,
entails *uilding portfolios with fresh funds or restructuring
legacy portfolios to provide *etter risk adjusted returns.
M)t)al 8)n$s F ?ur open architecture philosophy and Rest of reedI
selection of debt and eBuity mutual funds allows you to buy the top
performing mutual funds available in the market3
No) 0 tra!itio)a$ I)-&stm&)ts :
St)#t)e$ &o$)#ts F %ombinations of derivatives and financial
instruments create structures that have significant riskDreturn features
that may not be otherwise available in the marketplace. Structured
products are designed to provide investors with highly targeted
investments tied to their specific risk profiles# return reBuirements and
market e(pectations.
Real Estate Bent)e 8)n$s F To provide you with diversification avenues
which reduce the overall portfolio risk# we seek to bring to you
opportunities in real estate space through venture capital funds
available in the market.
ASS!0 SII!
5lo*ally, the 5roup $nvestment Business currently manages
and distri*utes assets over / B .4= *illion worldwide, at the
close of May .>><. Assets, which range from retail mutual
funds and money market funds to lifecycle products to
portfolios for private clients and institutions.
?@>
INF!S0M!N0 P#I")S)P#E
Nee2B*ase2 sales approach :ith inno'ation
!ur team works to suggest 2nancial solutions *ased on your
risk appetite, pro2le and needs. /sing customer insight, we
have developed a 2nancial planning tool. $t analyses and
generates a comprehensive 2nancial plan *ased on your
existing 2nancial position, expected future cash Nows, inNation
and identi2ed 2nancial o*jectives. !ur :elationship Managers
extensively use this tool to do 2nancial planning for you taking
into account your long7term o*jectives and M or medium to
short term reEuirements.
Hor consistent and uniform delivery of 2nancial planning as per
the de2ned customer need centric process, there is a
dedicated, independent ales Guality team to conduct regular
Euality checks close to the point7of7sale.
,hit&0$ist&! +#)!s
)he concept of white listed funds lies in the *ank(s open
architecture model, which lays emphasis on meritocracy. We
carefully look at various products availa*le in the market and
after thorough due diligence select product providers M
schemes which adeEuately correspond to the needs of our
customers. White listed funds are selected *ased on various
proprietary models that are used for intense Euantitative
analysis. )hese funds help our clients *uild a long7term
portfolio and in achieving long7term 2nancial goals.
T&"h)o$o%* is a pot&)t &apo)
Hor consistency in the manner in which our :elationship
Managers identify customer needs and suggest suita*le
solutions, we extensively leverage technology to support our
sales process. !ur indigenously developed systems like Wealth
Management ystem, Hinancial Planning ystem and 'ustomer
:elationship Management ystem have *een *uilt *asis
customer insights. We constantly look at evolving these
systems to address sales process reEuirements arising out of
dynamically changing market conditions and customer needs.
We therefore treat technology as a vital ally in executing our
philosophy of customer need centricity in a structured and
uniform fashion.
Shari)% th& ()o$&!%&
We freEuently organise wealth management events and
investment seminars, where you can interact with investment
experts and fund managers. )his provides us a platform to
know and understand the market and economic developments
and trends.
??@
Citi 'a)(
IN07)D<.0I)N
'iti has the largest footprint among wealth managers in the
Asia Paci2c with more than .> o@ces across the region. !ver
.,>>> wealth management professionals, including <>>7plus
private *ankers, 2nancial advisors and investment specialists,
serve <>>> high net worth individuals and families, including
half of all *illionaires in Asia ex7Sapan. 'iti 5lo*al Wealth
Management is a top7tier glo*al wealth manager providing
some of the *est institutional capa*ilities availa*le today.
erving *oth private and institutional clients, 'iti 5lo*al
Wealth Management taps the strength and resources of
'itigroup to maximi+e value and service.
)he 5lo*al Wealth Management division at 'iti comprises three
of the most respected *rands in wealth managementF
P7)D<.0S
C"t" &"!ate =an+
C"t" Sm"th =aney
C"t" %n!estment Resea#h3
A$$ET $I<E :s.30>'r.
ASS!0 ."ASS!S <S!D
INS<7AN.! P7)D<.0S ;
Structure2 pro2ucts ;
Art a2'isory ser'ices ;B
$n today(s market, art presents an attractive investment
option. )o assist you with advice on various art investments, or
to help you in *uying or selling art, 'itigold has tied up with a
???
reputed art house, !sians 7 'onnoisseurs of Art Private
8imited.
!sians is *ased in Mum*ai and possesses the expertise,
archival infrastructure and professional capacity to
systematically cohere various s)heirces of knowledge and
provide select 'itigold clients o*jective information on
purchasing, preserving, valuing and selling art for seasoned
connoisseur and emerging collectors.
'itigold together with !sians will now help you strengthen
your investments in art *y providing you the following
servicesF
1o#)mentat"on an$ A#h"!"ng
A)thent"#at"on* Cet"f"#at"on an$ Bal)at"on
&ese!at"on an$ Restoat"on
%ns)an#e an$ C)sto$"al Se!"#es3
&)/l"#at"on an$ 1es"gn Se!"#es
At an$ C)lt)al E!ents Management
Co,oate G"ft"ng
M)se)m an$ Colle#t"on =)"l$"ng Se!"#es3
Estate &lann"ng
.iti *an1 0ime Deposits
1e,os"ts hel$ "n )n"ts of Rs3 ?@@@ fo easy l"<)"$"ty3
8le9"/le ten)es fom ?5 $ays to 5 yeas3
O!e$aft fa#"l"ty of ), to >@L aga"nst yo) $e,os"t to f)n$ anothe
"n!estment o,,ot)n"ty3
A)tomat"# oll o!e fa#"l"ty to ene4 yo) $e,os"t 4hen "t mat)es3
An e9#l)s"!e set of st)#t)e$ ,o$)#ts l"+e ma+et l"n+e$ ,o$)#ts3
INF!S0M!N0 P#I"SP)#E
-iti ;ank is investing custoers !ortfolio according to
$4ic4 stage of life t4ey are <2
Co)ng a$)lt
Ma"e$ an$ yet to ha!e +"$s
&aent 4"th yo)ng +"$s3
&aent 4"th settle$ #h"l$3
??2
And according to e.!enses t4ey are t4inking of <2
=)y"ng a ho)se
Go"ng on a hol"$ay
Gett"ng ma"e$
Go"ng a/oa$
ICICI We!lt" M!n!#ement
INTRODUCTION
In India I%I%I bank is a very ,ell known banks in the field of ,ealth
management. I%I%I ank will float subsidiary for the purpose of ,/
activities in %anada & other market even as I%I%I has rolled out I%I%I
Eroup Elobal Frivate %lients for those with net worth of : + million or
more. I%I%I E%F% launched their business in >ubai very recently in
the month of April*1M and caught -;11 clients. They are going to add
another +111 high network clients this year.
I%I%I ank is using the services of global players like /errill @ynch#
%ity group# and 9S for catching the clients for ,ealth /anagement
business. I%I%I ank and its subsidiaries are engaged in the
development of various attractive products 4services5 for the clients
with net worth of : + million.
The eyes of I%I%I Eroup Elobal Fvt. %lients on the rising number of
dollar millionaires at present they are +11#111 in number in few year
the number will definitely increase. IndiaIs !o.- lender banker I%I%I
e(pects to sustain the L13 growth in its private ,ealth management
??3
business. I%I%I has +;1#111 customers with investible surplus of at
least 's. +1 lakhs eBuity# real estate and private eBuity is driving the
private banking business in India. India has market of ,ealth
management about : 211 billion.
PRODUCT$
N.A
Asset classes used
!98$9" ):A#$95 F )hey also *ring to you the *est value for
money through competitively priced *rokerage charges for
online share trading services from ///.&'&'&0&re't.'o. With a
07in7, account consisting of a trading account, $'$'$ Bank
savings account and demat account, you can stay connected to
the market at all times. )o add to this, )hey give you waiver on
the account opening charges tooK
With a 07in7, account consisting of trading, $'$'$ Bank account
and demat account, you can enjoyF
Com,et"t"!e ,"#e$ /o+eage ates
Re$)#e$ a##o)nt o,en"ng #hages
Onl"ne shae ta$"ng se!"#es
MUTUAL FUNDS :
)hey o&er you advice on the entire universe of mutual funds.
o *e it eEuity funds, where you look for growth and capital
appreciation or de*t funds for capital preservation, )hey can
help you select the right mix to suit you. 'hoose from an array
of more than ,3 fund houses with innumera*le schemes.
C#stomis&! Pro!#"ts
St)#t)e$ &o$)#ts F The" St)#t)e$ &o$)#t offe"ngs ae ta"lo-ma$e to
s)"t yo) "n!estment o/0e#t"!e an$ "s+ a,,et"te3 The" se!"#es "n#l)$e
&otfol"o Management Se!"#es an$ s,e#"ally $es"gne$ ,o$)#ts that ae
E<)"ty o %n$e9-l"n+e$ "n nat)e3
Altenate Asset &o$)#ts F They offe ,o$)#ts 4h"#h #om,lement
yo) e9"st"ng "n!estments eg3 At 8)n$s* &"!ate E<)"ty 8)n$"ng* Realty
8)n$s3 So* "f yo)He loo+"ng /eyon$ the sto#+ ma+et* yo)Hll f"n$ )s thee
tooM
Life and eneral Insurance
Asset SI!E
#s.)23* -r.
??4
$9C")M"9) PA$8!PAQ !ur approach emphasi+es a
glo*ally diversi2ed investment strategy designed to provide
a*ove average performance, at *elow average risk.
AXI$ )ANB C WEALTH MANAGEMENT
?ne of IndiaIs leading private sector banker A(is bank also combined
with anBue Frivee &dmond de 'othschild &urope based ,ealth
management e(pertise institution & is going to make new standard for
the !'IIs ,ealth management.
The @%$ 'othschild group has based its reputation in the area of
,ealth management on its big banking e(perience. Actually the
institution is engaged in the task of providing financial advise to the
&uropeIs leading families# Eovernment and various corporations for the
last RLI generations.
The A(is ank ;
th
largest bank by market capitali0ation in India
provides payroll services to over +-111 corporates across -.M million
salary accounts. The market capitali0ation of A(is ank was -<;
million in the last year -11L is engaged in the business of ,ealth
management# with its international presence in >ubai# Singapore Aong
"ong# Shanghai and so on.
??5
Ass&t Si1&
#s.)').2* -r.
??.
Pro'e0+re or entert!&n&n# ! 'l&ent &n AXI$ )ANB
+. Any customer who has a portfolio having more than <1 lakhs can
reBuest for wealth management services at any branch of A(is
ank.
-. After the reBuest of customer the wealth mangment relationship
manager will meet the customer and make a view about his risk
taking ability according to his current financial position and
future needs.
<. The customer has to fill a risk profilier form#details of which is
interpreted in a software called 7mohar8 by which the analyst will
come to know the actual risk taking ability of customer.
.. >ocumentation )* The customer has to make available the
following documents to the ank )*
a. Fan card %opy
b. M Fhotographs
c. ?ne Address Froof
;. The client has to open four accounts with the A(is ank )*
a. ,ealth Saving Account )* This account is used to park all
the money of the customer which must be <1 lakhs or
more than that .
b. >emat Account )* This is used to park all the assets in
electronic form of the customer .
??5
c. Trading Account )* This account is used to buy or
purachase the asset in a electronic way.
d. ,ealth Account )* This account is opened in the mohar
software to handle the portfolio of the customer.
2. The whole <1 lakh or more is not invested in a lumpsum but it is
invested in trenches in a period of . months.
L. The service provided by the A(is ank is a !on* >iscretionary
type of service# in which the decision of investing money is taken
with customer recommendation.
M. All the transaction done for the customer either sell or purchase
of the asset classes is done fully electronically through 7/ohar8
software.
=.%harges )* +3 Annual %harges on eBuity portfoilio T 1.L; 3
brokerage either sell or buy .
!o charges on mutual fund portfolio .4Asset management
%ompanies gives -.;3 commission to A(is ank on investing client
money in their mutual fund. 5
Asset management %ompanies charges -.-; 3 only on purchase of
mutual fund directly to the customer without any involvement of
the A(is ank.
??:
Co+stmer Pro&l&n# !t A,&s )!n1
ased on different financial needs an average life cycle has been
divided into . stages of $inancial Flanning as given below.
9pto <1 years of age
<1*.; years of age
.;*21 years of age
over 21 years
7,to 3@ yeas of age
9eneral Profile <2
?ut of collegeDFrofessional %ourse.
Sunior or /id level employment.
Aave had an average work life of ;*M yrs.
9nmarried or recently married.
Small family.
!uclear family D Soint family.
Gener!l C"!r!'terst&'s .3
Salary surpluses#especially if single or >I!".
??>
/inimal family responsibilities
Fropensity to spendDoverspend
$ind investmentDsaving as oring & waste of time.
@ack of inclination to invest.
@ack of proper information on investment.
>o not need regular income from investment.
In%estment Nee0s .3
'epayment of professional studies loan.
Flan for ta(.
Saving for white goodsDnew vechile.
iggest need is to save enough for a down payment for
a house.
Start to build an emergency fund.
Re'ommen0!t&on .3
!egotiate ta(*efficient salary.
udget and keep track of e(penses.
9se credit card prudently.
Save regularly and consciously.
?2@
Re'ommen0e0 In%estment $t-le .3
Should be an aggressive investor.
Should focus on long term capital growth rather than
short term capital preservation.
Aave a long term investment hori0on#as a balance of
productive working life is high.
%an invest in high risk# high gain products
?2?
'ecommended distribution of asset )*
=1 3 investments in eBuity.
+1 3 investment in debt.
Should start SIF or recurring deposit through auto debit
facilities to ensure disciplined and compulsory savings.
Should start planning for or at least start thinking about
retirement.
Pro0+'t Re'ommen0!t&ons .3
If salaried# appro(imately -.3 of basic is necessarily
invested in F$ and can be supplemented with !S% &
FF$.
If self employedDprofessional# should start a
FF$DFension plan investment to provide for retrials.
Invest part of the surplus marked for eBuity
investment # in eBuity oriented funds like )
o >iversified eBuity funds42135
o Sector funds4+135
o Ta( saving funds4-135
?22
etween <1*.; yrs )*
Gener!l *ro&le .3
/arried #usally with children
/iddle to senior level employees.
Aave had an average work life of +1*+; yrs.
/ay have dependent parents
9sually a personal vehicle owner.
Already invested in a homeDseriously thinking of
investing in a home.
Gener!l C"!r!'ter&st&'s .3
Surplus funds are limited.
@ifestyle e(penses go up
%hildren needDe(penditure is of prime importance.
Aousehold e(penses are gradually increasing
'eali0e the need for investment planning but lack
time for investment planning.
In%estment Nee0s .3
Shelter income from ta(es.
Flan for childrenIs higher education
?23
Start to build capital for retirement #if not started
already.
/aintain an emergency fund & keep adding to it.
uy a homeDservice a home loan.
Save for holidaysDrecreation.
?24
Re'ommen0e0 In%estment $t-le .3
%an take medium to high risk.
Should continue to focus on capital growth.
Investment hori0on is still more than ; yrs.
$ollow thumb rule of +11 less your age in years as
percentage of savings to be invested in eBuity.
9pto 213 of surplus funds can be invested in eBuities.
+;3 of surplus funds in liBuid funds.
-;3 in ondsDFF$D!S%.
Pro0+'t Re'ommen0!t&ons .3
>iversified eBuity funds#more tilted towards
large caps for capital growth for retirement or seed
money for home loan.
uild up a direct eBuity.
Invest in children specific mutual funds to
provide for childrenIs higher education needs .
!S% and FF$ to balance investments in eBuity.
Ta( efficient saving through &@SS.
"eep adding to short term floating rate funds
and bank $>Is for emergency fund.
?25
Eet medical insurance for your dependent
parents.
Eet household contents insured.
Eet a life insurance against your home loan.
Eet an accident insurance against any
disabilities.
etween .;*21 yrs.
Gener!l Pro&le .3
9sually at the peak of carrer
Erown up children.
/ay need take care of dependent children.
'etirement is not very distant.
%ould opt for Q'S.
/ay have a inherited portfolio of investments from
parents.
Gener!l C"!r!'terst&'s .3
surplus fund higher than in previous life stage.
Aigh outgo on household e(penses.
%hildrens e(penses continue to increase.
?2.
@ife style e(penses still high.
-*< major oputflows of money 4overseas
educationDmarriageDset up business5.
Aigh liBuidity is a must.
Sensiti0ed to medical and retirement needs.
Re'ommen0!t&ons .3
>ecide when to reire.
AcBuire all necessary consumer durables while still to
plug future outflows.
%onsolidate and continue with wealth creation
Start de*riskiking yoyr portfolio.
'evisit and revise financial goals.
'ebalance your portfolio as per future needs.
/edical insurance a must.
Fension plans must be started if not done already.
Frepare a will.
Re'ommen0e0
In%estment $t-le .3
?25
Ereater vunerability to
risk hence focus on moderate balanced growth.
Shift focus from capital
growth to capital preservation.
Investment time
hori0on comes down.
Turning point as
investment debt now outpaces investment in eBuity.
9p to .13 of surplus
funds in eBuity.
9p to 21 3 of surplus
funds in debt.
Pro0+'t re'ommen0!t&on .3
Frepay or finish all loans by ;; years of age.
Invest in balanced funds or /IFIs
Fhase out high risk sector funds gradually.
"eep investment in well*diversified large cap funds.
Investment in debt should be around !S% & onds.
Short term deposits and floating rate funds#along with
cash or liBuid funds should be maintained for liBuidity.
?2:
%onsolidate direct eBuity portfolio)gradually move part
of it to high divinded yield stocks.
"eep all surplus funds in liBuidDfloater funds.
Above 21 years of age
Gener!l *ro&le
'etiredDworking part time
@iving in self owned house.
%hildren may be living separately.
>ependent parents#needing medical attention#may be
part of family.
%ould have grand children.
Aave more leisure time.
Gener!l C"!r!'ter&st&'s
Income from e(isting investments#usally the only
source of regular income.
Surplus funds usually not available for additional
investments.
%apital preservation is the primary need.
Aigh life e(pectancy hence present capital has to
stretch over a long time.
?2>
@ife style e(penses go down.
/edical e(penses go up.
In%estment nee0s.
'egular income needed from investments.
&mergency funds for medical etc.
to be liBuid and high.
Freservation of wealth.
/oney for travelingDgifts.
!eed funds to pursue hobbies to keep busy.
Re'ommen0!t&on
/onitor e(penses to fit into the retirement income.
&nsure ta( efficiency of returns on investments
&(plore second careersDpart time employment.
%heck e(cess liBuidity as it needs to reduced returns on
investments.
Too much cash should not be kept with oneself in the
house#as it may be a risk.
>o ma(imum purchase transaction through debit cards
to avoid the needs of cash withdrawls.
?3@
Re'ommen0e0 &n%estment st-le
/ost chaleenging phase of life.
%apital preservation of utmost importance.
@ow risk appetite.
Income generation & consumption phase of investment.
Investment hori0on low.
/a(imum +;3 eBuity e(posure.
Pro0+'t Re'ommen0!t&ons
Invest in /IFIs and balanced eBuity funds.
Senior citi0enIs saving schemes.
Fost office monthly schemes.
$>Is with monthly schemes.
'I ond
%ontinue with direct eBuity portfolio with high dividend
yield stocks.
Avail all possible ta( breaks available to senior citi0ens
Switch some investments from eBuity to debt and
money market products.
Eo for systematic withdrawls plans4reverse of SIF5.
?3?
Erowth portion of portfolio should be reduced to
maintain only enough amount.
Silver health mediclaim.
?32
?33
?34
?35
?3.
?35
?3:
?3>
?4@
W!A"0# MANAA!M!N0 ; INDIAN .)N.!7N
?4?
Pos&t&on o In0&! &n We!lt" M!n!#ement
The wealth management industry in India is e(periencing an
evolutionary phase of development# according to %elent. ,ith the
liberali0ation of the Indian economy and subseBuent growth and
prosperity across sectors# the wealth management industry is poised
to gain greater traction. %elent segments the Indian wealth
management market and looks at trends and opportunities at the
provider end.
According to the report# India is slated to become a 9S:+ trillion
market 4in assets under management5 for wealth management
providers by -1+-# with a target market si0e of .- million households
In the annual survey done by %ap Eemini# SA and /errill @ynch it was
found that ranks of millionaires grew 23 in the previous year# because
the number of richer people grew in India & %hina where India is
competing %hina. India & %hina posted the biggest gain in millionaires
advancing by -<3 & -13 respectively.
,hen They are watching the world wide increase in number of
millionaires the facts collected by %ap Eemini# S.A. and /errill @ynch
survey report. India has -<3 growth in the last year. The biggest
Asian economy %hina stands on second position with -13# west Asia
+23# 9nited States .3 and 9nited "ingdom 49"5 -3. So They can
understand that there is more opportunities in the ,ealth
management business in Asia specially in India.
R&s1 !%ers&on o In0&!n '+stomers
?42
The repercussions of the mutual fund scandal of the +==1s are still
evident. /any Indian retail customers averse to diversifying their asset
base into higher risk classes. To account for this conservative
tendency# F$S offerings can be tailored to emphasi0e the value of a
lower*risk investing approach.
J9ew moneyL mass aDuent customers are not accustomed to
Wealth management. Most customers are used to o*taining
2nancial services on an as needed *asis without much regard
to a full view of their 2nancial Well7*eing. As
part of the opportunity to de2ne and develop o&erings for
$ndia(s emerging A9W population, customers may need an
introduction to the concept of private *anking 6or Wealth
management-.
hortage of skilled personal 2nancial advisors. )o date, the
PH opportunity has *een limited to a very small segment of
the population, so domestic *anks have not generally
developed expertise in comprehensive personal 2nancial
management. 5lo*al *anks can take advantage of this gap *y
leveraging advisory competencies that they have cultivated in
other markets, importing that expertise into the $ndian market.
?43
?44
?45
?4.
?45
?4:
Southern Asia )*I!>IA#S'I@A!"A
?4>
WEALTH MANAGEMENT ON GLO)AL
PRE$PECTI(E
,ealth managers and private banks are anticipating unprecedented
growth over the ne(t three years# according to the latest findings from
Fricewaterhouse%oopers -11L Elobal Frivate ankingD,ealth
/anagement Survey# with chief e(ecutives predicting that# on average#
their assets under management will increase at a staggering rate of
<13 per annum.
The survey# which captured the views of senior e(ecutives of -2;
organisations within the global private banking and wealth
management industry# highlighted that markets in Asia Facific and
&astern &urope are e(panding the fastest# as organisations rush to
service the new wealth creators in these regions. In Asia Facific# %&?s
e(pect their organisationsI assets under management to grow at an
annual rate of <.3. %&?sI plans for growth include entry into these
lucrative markets# including by acBuisition. Almost =13 of %&?s feel
that there will be at least some# if not significant# consolidation in the
industry and more than ;13 of %&?s plan to open operations in new
countries over the ne(t two years to access new clients.
The survey reveals a period of e(ceptional opportunities for wealth
managers. uoyed by rising global wealth# wealth managers
everywhere are anticipating e(tremely high rates of profitable growth
that have not been seen during probably at any other time. The survey
?5@
highlights that this is a time when strategic choices have to be made
by chief e(ecutives and finite resources have to be focused on serving
e(isting clients as well as supporting highly ambitious growth plans.
Fricewaterhouse%oopers latest findings also revealed a real
commitment among wealth managers to increase Rshare of walletI#
compared to previous surveys. Share of wallet has emerged as the
new key performance indicator# globally as well as in emerging
economies like India# as wealth managers seek to become trusted
advisers and gain new clients. %urrently under ;13 of wealth
managers hold more than .13 of their clientsI investable wealth but
over the ne(t three years this proportion is estimated to increase
dramatically to almost M13 of wealth managers holding over .13 of a
clientIs wealth3
?5?
?52

?53
?54

?55
?5.
PROJECTION$
After studying the overall concept of Wealth management we
can say that it has various aspects some are favora*le and
friendly for the economy and some are very dangerous for the
economy.
According to World Wealth :eport >;7 Merr&ll L-n'"A
C!*#em&n& F
)he early months of .>>; revealed further complications to the
conditions facing the glo*al economy at the end of .>>=,
heightening uncertainty among investors regarding the near7
term glo*al outlook. #eepening credit market woes threaten
growth prospects in key mature markets.
Aowever, still7strong fundamentals in emerging markets are
likely to sustain high levels of growthOa divergence that will
likely impact consumer and *usiness segments and shape
policy choices. )he *alance *etween emerging market strength
and mature market recovery is likely to persist through .>>;,
with the short7term outlook su*ject to varia*ility given that
aspects of potential risk may still *e unknown.
7y and largeA t4e glo;al econoy 4as t$o distinctive
o;stacles to overcoe<
%nh"/"tos to go4th "n mat)e ma+ets3
H"gh "s+s of "nflat"on "n emeg"ng ma+ets3
04ese c4allenges $ill s4a!e glo;al 81:I gro$t4
!ros!ects going for$ard.
?55
?5:
5iven .>>= performances and taking into consideration recent
developments in world markets, the projection of glo*al A9W$
wealth will grow to /B34., trillion *y .>,., advancing at a
rate of =.=? per year.
04is !roBection is ;ased on several factors<
:ecent economic downturns in the /nited tates have *een
shorter *y historical comparison attri*uted, in part, to
increasingly e&ective monetary policy. )herefore, the current
complications are not expected to weigh on growth prospects
as heavily as they may have in the past. imilarly, research
suggests that emerging markets( recoveries have outpaced
analysts expectations. Moreover, as A9W$ portfolios continue
to grow more diversi2ed over the long term, spread across
international *oundaries and asset classes, their investments
*ecome increasingly mo*ile.
)hus, as growth in one region or market slows, A9W$s can
move freely, reallocating their funds to other areas, often more
Euickly than the trou*led market itself can react and recover.
/ltimately, this evolution will make A9W$ investments less
vulnera*le to market downturns.
?5>
BIB")A7AP#E
+.,ealth /anagement Suly12 private banking poll*rM report.
-.www.moneycontrol.com.
<.www.google.com.
..I%I%I Frudential Asset /anagement 'eport.
;. ,orld ,ealth 'eport -11M * /errill @ynch# %apgemini.
2. 7Kear*&nd 'eview of /arkets & $inance#8 The ,all Street
Sournal# Sanuary -# -11MP 'ussia Trading System#
http)DDwww.rts.ruDen# accessed April -11M.
L. The &conomist Intelligence 9nit# Sanuary -11M.
M. Investment Strategy * !o.2 August -112 Societe Eenerale Asset
/anagement.
=.Eoldman Sachs Asia Facific 'eport.
+1. I/ usiness %onsultingIs ,ealth /anagement 'eport.
++. A(is ank 'eports.
?.@