Building Investment Advisory Business PRUDENT CAS LTD. - Money through wisdom -

Vision without Action & Action without Vision leads to failure Key To Failures

I want to build the Investment Advisory Business I want my clients to satisfy their financial dreams I want to earn a sustainable stream of money from this business I joined Prudent CAS Ltd Vision

Where you want to be? Where you are? Believe …. Who is your Customer? Understand your Market Understand your Competition DECIDE….

It is important to SET a target I will Sell Mutual Fund I Will Also Sell Equity Funds Now I Will Build Up An AUM of 2 cr. at the end of year I will also earn an Upfront Income of 3 lakhs by selling Mutual Funds at the end of the year TARGET CHALLENGES YOU … TO ACHIEVE ITSELF ACTION / TARGET

Build Your Future with Action & Vision Key to Success

Build your future with action & vision I know my target I require a focused action plan as time is less Until you value yourself, you will not value your time. Until you value your time, you will not do anything with it.

PROSPECTING Prospecting Clients … Family Relatives Friends Office Employees / Colleagues Neighbours Friends Relatives Building / Society Members Clubs / Social group contacts Referrals Reaching Clients … Telephonic calls Personal Visits ing / Postal Mails Advertisements in Newspapers/Magazines Clients Meetings Investment Mela Stalls at venues / events Employees Through Referrals

The Process – Partners Target / Goal Setting Preparation Prospective List of Clients Scheduling Meetings / Calls & Execution Assessing Progress / Resetting Goals Taking appropriate actions for shortfalls

Understand the customer … Always listen more Do not hard Sell Look at the Household … a channel Servicing … irrespective of immediate benefits Some Basic Ideas

CASES OF FOCUSSED ACTION PLAN

Mr. Ram Sets an Target of Rs. 10 Lakhs per month SIP to be achieved by the year end. Mr Ram is in the business since last 10 years and have a client base of 500 customers. What Mr. Ram needs to do to achieve the target? Case – 1 ( Partner with Existing Investor )

Guesstimate the Average Size of Monthly SIP Rs. 2000Rs Rs No of SIPs Needed per Year No of SIPs Needed per Month No of SIPs per Household No of Household to Convert What is my monthly SIP requirement

So now you are very clear how many Household to Convert Every Month. Prepare the list of the client where SIPs can be sold ( Especially people in the age group of 25 – 50 years) and to whom to contact these month. Call them and explain the concept of SIPs. Advantage 1 – It helps us to know your immediate target Breaking Target Monthly

Mr. Shyam is new to the business but is interested to Develop the Business. He has Decided to Target Rs as average ticket size for Monthly SIPs. No of New Household to add every month is 8. The best place to get that ticket size is a Doctor, middle to high level managers, mid size businessman. Case – 2

Decides on Following activities to be done these Month. Make the list of prospects known to You. Send them SIP Mailers to them and subsequently call for an appointment. Stall at Mela, shopping mall and at various locations. Corporate Presentation Cold calling in Doctors/ Mid Size Business Advantage 2 - Help you to list down the activities. Preparing Activity Calendar

For them to sell SIP they should be Trained to Sell Equity and SIP. They Should have Equity Presentation Kit and SIP presentation Kit ready in the Bag. They should have Financial Planning Calculator CDs and Saving Calculator Form with them. Advantage 3 – It helps you to identify your training & Knowledge Needs, and helps to identify your Sales Kit In case of Mr. Ram & Mr. Shyam

Achievement Ratio in each targets Target Achieved / Target Set If achievement ratio is less than 100% review the activity undertaken. Target Improving the quality or quantity or both of activities undertaken for the next month. Advantage 4 – Helps you to improve your productivity at every stage. Evaluation of Monthly Target

Advantage 1 – It helps us to know the no of people /TARGET for the month Advantage 2 - Help you to list down the activities / SCHEDULE for the month Advantage 3 – It helps you to identify your immediate TRAINING & Knowledge Needs Advantage 4 – Helps you to improve your PRODUCTIVITY for the next month Advantages of Focused Action Plan

Gives Focus to achieve targets. Prudent will help you to achieve your monthly plan. Benefit of Monthly Plan

Meeting Your Customer

Opportunities are limited Be Prepared for the call – require a comprehensive sales kit while you meet Know your SERVICES well ( WEB services) Follow a scientific sales process to increase your productivity Meeting Your Customer

Basics of Mutual Fund. Equity Presentation. SIP Presentation. Power of Compounding Calculator. Valuation & Other Clients reports Savings Calculator Form. Insurance Need Analysis Form. Sales Kit Needed with each Partner

SCIENTIFIC SALES PROCESS

Introduce your company Step 1 - Introduction

Where do you invest normally invest your saving? What is the most important criteria while making investments – Safety, Returns,Liquidity Have you ever invested in mutual funds ? Which schemes have invested into ? Aware of Liquid Schemes, Floating Rate Schemes, Equity Schemes Objective is to know, in which 3 of the following categories the customer is ? Step 2 – Undersatand / Classify the customer

Category A – An existing MF investor with thorough/Good knowledge Category B – An existing MF investor with partial knowledge / Misconceptions Category C- Not an MF Investor at all Step 3 – Classify the customer into 3 categories

CATEGORY - A An existing MF investor with thorough knowledge

How do you select Asset Class ? How do you select schemes ? TALK ABOUT ASSET ALLOCATION Step 4 Follow following flow chart

Asset Allocation is Decided Based on Expected rate of Return ( ERR) ? Explain the present ERR from DEBT& Equity – Use Equity Presentation for the same & Suitability Graph & Benefits of Investments in Mutual Funds-Equity Schemes A required ERR or Asset Allocation is a function of FINANCIAL PLANNING & RISK PROFILE Explain steps of fin planning With brief examples DURING THE DISCUSSION MARKET TIMING STORY MAY COME & ALSO INVESTMENTS IN DIRECT EQUITY Optional STEP 5 STEP 6

Once Asset Class Discussion is over, Scheme Selection story will come Highlight Prudent Services – Research, Web Services Specific scheme discussions may Take place – KNOWLEDGE of that Is important Talk about basic financial planning- 1.Savings Planner 2.Insurance Need Analyser 3.Risk Profiler 4.Pension Planner 4.Portfolio Restructuring STEP 7 STEP 8

If Intersted in any of the above, get it filled Fix Up appointment to come with a working Next time If not intersted in above but interested in products & information Highlight Prudent web Services & subscription services Start sending mails & put him to subscription Follow Up at a later date Try classify customers as Advisory Oriented or Transaction oriented, Try Transaction oriented customers to convert to advisory oriented at a later time UNTIL You conclude he is only a Transaction Oriented – Market Timing Reach next time with a Plan & make him your customer

CATEGORY - B An existing MF investor with partial knowledge / Misconception

If existing investor with partial knowledge or Misconceptions Explain in Details both debt, equity & Mutual Funds IF you feel discuss Asset Allocation or Highlight Prudent services in details & follow the same process as in Customer Category A STEP 8 onwards

CATEGORY - C Not an MF Investor at all

If existing investor not a MF invetsor Highlight basic of MFs Presentation to be carried Focus on Liquid & SIP (Power of Compounding) Highlight Prudent Services in brief Discuss Basic Financial Plans STEP 8 onwards in customer category A

CLASSIFY in category A,B or C Complete the Education Process as per classification Pitch Basic Financial Planning Services For Existing Customers

Always start with a greeting Some modest way to praise the customer Ask briefly about his business or profession There is no Short Cut – Education is the key Dont scare to explain the risk Never Hard Sell Dont over commit & honor your service commitments Customers Need is primary – Product is secondary Always carry the SALES KIT because opportunity comes only once SOME IMP POINTS TO REMEMBERED

Target Segment Young – Age Group (25-40) Old Aged / Retired Very Savvy investor Highlight Savings Planner Insurance Need Analyser Pension Planner Risk Profiler Web Services TARGET SEGMENT

A Customer comes to you and is not at this stage not interested in Financial Planning but wants to invest Rs in Post office Scheme. He has no requirement for Regular return as he is 40 year old and wants to create capital Case 1

As Investor dose not require any money from his investment Proportion of Equity should be incorporated. If possible fill up the risk profiler to understand his risk appetite and probable asset allocation. In this case the client is satisfied with 8 % return. Use POWER of COMPOUNDING Table to convince him that how higher rate or return can change his wealth Analysis

Power of Compounding Table

18.57% 0 / 13 Equities: Not Risky in Long Run

In past 28 years BSE Sensex has given about 20% returns Past Performance (BSE Sensex) YearSensexInvestment Rs ,00, ,70,00,000 This is in spite of … Two wars At least three major financial scandals Assassination of 2 prime ministers At least 3 recessionary periods 10 different governments and An unfair share of natural disasters

Part 3 Financial Planning

Investor would like to pay for Financial planning. It is the most scientific way to make investments.

Where do you want to be & when –Define your financial goals in terms of how much you will need and when Where are you? –Check your financial resources How do you get there –Asset allocation Are you on course –Periodic review of your investments / your own condition Financial Planning Process

Financial planning is very simple to understand by any body. It is not time consuming. What one has to do is simply get a Saving calculator Form filled up by an investor which hardly takes time. Using the proper Financial Calculator gets you the desire results in just few minutes. The fact is any investor need financial planning for achievement of Investment Goal FACTS ….

Dr. Deol is a renowed eye specialist in Jaipur. He had understood the concept of Mutual Fund from a, Mr Anil, Prudent Partner and had invested Rs. 1 Lakh in Mutual Fund. Partner gave him a follow up call and had an appointment with him. Mr. Deol had already done some homework and had tried to understand some Pension Plan and Other equity funds from another broker. Mr. Anil knew the investor was confused and explained him the concept of Financial Planning Customer at that instant was ready to fill the Saving Calculator form. Example of Financial Planning

Dr. Ram Age 35 Anita ( Wife) Age 30 Sunil ( Son) Age 8 Rajshree (Daughter ) Age 4 Saving Need Analysis

Wanted to retire at the age of 55. Current Expense Rs per month. Amount of money require at retirement for peaceful retirement. Retirement Need

Marriage Need To get child married at the age of 24 and cost involved in the community is 10 lakhs per child No investment till date has been done for that Education Need Was very keen for providing Rs. 10 lakhs for each child for better education to them. Age of child going for higher education is 18 years Child Need Analysis

Next day Mr. Anil Worked on the data and went to Mr. Deol with the following workings. It took Mr. Deol 15 mins to fill the Form It took 10 mins for Mr. Anil to prepare using the calculators Analysis Done

SOLUTION 8 % & 7% Assumed Your Goals !SIP One time Lumpsum Amount REQUIRED AMT. AT YOUR AGE Saving Years HIGHER EDUCATION Sunil10, Rajshree8, MARRIAGE Sunil7, Rajshree6, Mr Devol32, SIP 68,083Lumpsum 76,29,960

SIP 56,020Lumpsum 55,26,974 SOLUTION 10 % & 7% Assumed Your Goals !SIP One time Lumpsum Amount REQUIRED AMT. AT YOUR AGE Saving Years HIGHER EDUCATION Sunil9, Rajshree7, MARRIAGE Sunil6, Rajshree5, Mr Devol25,

SIP 46,051Lumpsum 40,45,144 SOLUTION 12 % & 7% Assumed Your Goals !SIP One time Lumpsum Amount REQUIRED AMT. AT YOUR AGE Saving Years HIGHER EDUCATION Sunil8, Rajshree6, MARRIAGE Sunil5, Rajshree4, Mr Devol20,

SIP 34,335Lumpsum 25,81,297 SOLUTION 15 % & 7% Assumed Your Goals !SIP One time Lumpsum Amount REQUIRED AMT. AT YOUR AGE Saving Years HIGHER EDUCATION Sunil7, Rajshree4, MARRIAGE Sunil4, Rajshree2, Mr Devol14,

Mr Deol was now very clear as to what he needs to do. He was comfortable to save Rs lakhs P.A. So now he is clear that he has to target 15% return. Asset allocation suggested was 80% equity & 20 % debt. Anil took the opportunity to give him presentation on equity and its benefits in the long term. Got 2 lakh of investment from Mr. Deol in the ratio of 80 % Equity and 20 % debt. Also gave him a monthly SIP of Rs from Mr Deol The Balance Investment Needed to be done will be doing during the year. Action Taken

Just few minutes and better selling process gave you a new client. He would be always your client now. You and your client will now always have better clarity in making investment decisions in future course. Learning from these example

Decide the Target till March 09 Make your Business plan with Prudent RE / BA Prepare your SALES KIT CONCLUSION

THANK YOU PRUDENT CAS LTD. - Money through wisdom -