Why Most Investors In India Ignore Transparency When Selecting Financial Advisors

India’s investment advisory industry is expanding rapidly, but experts warn that nearly 99 percent of investors miss key considerations when choosing an advisor. The majority prioritize promised returns, ignoring essential safeguards such as regulatory compliance, clear fee structures, and advisor accountability.  

SEBI registration ensures that advisors operate within legal frameworks, protecting investors from fraud and malpractice. Transparency in advisory practices, including risk communication and realistic expectations, is equally vital. Many investors also fail to check whether advisors prioritize client interests over commissions or product sales.  

Financial literacy is crucial to bridging this gap. By understanding advisory models and evaluating compliance, investors can make informed choices and avoid falling prey to misleading claims. Analysts emphasize that accountability, ethical practices, and long-term trust should form the foundation of any advisory relationship.  

Key Highlights  

• 99 percent of investors overlook compliance and transparency  
• SEBI registration critical for investor protection  
• Fee structures and risk communication often ignored  
• Conflict-of-interest disclosures essential for trust  
• Ethical practices and accountability drive long-term success  

Sources: Economic Times, Mint, Business Standard