Now is the right time to fire your investment advisor

We wary if your advisor is pushing you to increase allocation to smallcap and midcap funds (Photo: AP)
We wary if your advisor is pushing you to increase allocation to smallcap and midcap funds (Photo: AP)


  • Unscrupulous advisors, platforms and brokers can do the most damage when markets are euphoric

Now is the right time to fire your investment advisor.

Let me repeat that.

Now is the right time to fire your investment advisor...

And close your mutual fund investment platform account…

And maybe even shut down your broking account.

Let me add here that I don’t want you to fire them for no reason.

I think you should consider firing them for the right reasons. And that too, now.


Because now is probably the time when unscrupulous advisors, platforms and brokers can do the most damage.

You see, in moments like these, when greed is peaking, you can truly assess who’s batting for you and who’s batting for commissions.

All it takes is to be a little rational and look for signs.

Here are some signs you should look for:

Your advisor is pushing you to increase allocation to smallcap/midcap funds.

Your mutual fund platform is nudging you to invest more, or start investing in the recently best performing schemes i.e. smallcap/midcap schemes.

Your broker is sending you even more research on smallcap/midcap stocks, or pushing every IPO that hits the market, without any care for the fact that valuations may be expensive.

These are perhaps the easiest signs to pick up.

Now, I am not questioning the integrity of the person or platform. Maybe they genuinely do believe in their view. But then the question you need to ask yourself is that when some of the smartest minds out there are advising caution, does this person/platform know something which no one else does? It’s possible. But unlikely.

I believe moments of greed like this one can help you lay a foundation for creating an ecosystem which can help you succeed as an investor. Use it.

Select advisors who are poring over the numbers with their clients to ensure their asset allocation is in line with their needs and that they are not overexposed to the risky parts of the market. They are in fact redirecting monies to ensure long-term success.

Select platforms that are not chasing their clients to make them transact, but those which are nudging their clients to think so that they can make more meaningful investment decisions.

Select brokers who go beyond the Sebi-mandated warning for dissuading their clients to trade in speculative segments of the market.

These advisors/platforms are giving up income so that their clients can succeed in the long term.

What could be better proof than that? Find them!

Some of you may notice that I did not mention anything about finfluencers. Well, most of what most finfluencers put out is anyway momentum-based and unproven. So, if you like a roller coaster ride when it’s possibly headed down, that’s your call. You may decide to stick with them or exit their cohort, depending on your appetite for thrills.

And I am not even venturing to discuss what to do if someone is pushing a ULIP on you. Forget deciding whether to invest or not, why are you even wasting time discussing the possibility?

In conclusion, I would like to very emphatically state that there are many investment advisors out there who genuinely care for their customers. And perhaps platforms, too.

Sift them out and latch on to them.

Who knows, they may yet have time to save you before the current euphoric phase (if it is one) dies down, and set you up for long-term success, helping you meet your life’s goals without breaking a sweat.

Happy investing.

Rahul Goel is the former CEO of Equitymaster. You can tweet him @rahulgoel477.

You should always consult your personal investment advisor/wealth manager before making any decisions.

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