Trend of individual wealth in India
Investors are invested in their journey to wealth creation.
The transition of wealth from the hands of the older generation to next-gen millennials has begun and with it has transitioned the outlook of the average investor. Wealth can be divided into Financial assets and Physical assets. While the previous generation emphasized more on physical wealth like real estate, gold, etc., the current generation is showing clear signs of higher dependency on and favour for financial assets like stock, mutual funds, bonds, and more. This trend could be attributed to the need to avoid absolute illiquidity thus ensuring wealth flexibility.
Changing trend of investors - From FDs to US stocks
The lack of discretionary spending, the need for passive income, and the availability of ample time to learn the ropes of investing in this past year have aided the change in investor behaviour. Accessibility to cutting-edge investing to broker ARN transfer platforms and other easy tech-based platforms and multiple avenues to enter the financial markets propelled the growth of new-age investors. Brokers operating in Indian markets have already witnessed a significant rise in new investors in the Indian stock market, a similar rise is being witnessed with millennials investing in global markets [1].
India’s economy contributes about 3.3% to the Global GDP, while countries like the USA & China contribute 23.6% and 15.5% respectively [2]. One may wonder why investors would choose to invest in global markets while Indian markets are proving their grit even through these testing times. The fundamental factor that differentiates Indian from Global markets is the accessibility to invest in established brands/businesses that are not listed in the Indian stock markets (e.g., FAANG). Similarly, based on the current trend and progress across industries, the domain of technology, genomic revolution, and AI & ML are proving to be the next big growth opportunities and most of these companies are listed in US stock exchanges. To participate in their growth investors need to diversify their investments across borders.
Technology bridging the gap
Technology as an investment for investors – the next Big Thing
The rapid adoption of technology across a pandemic hit globe, gave a boost to an already trending set of stocks. Together, FAANG’s which represent 15% of the value of the S&P 500 [3] (as of Feb 2021) is a catalyst to a giant portion of the gains witnessed by investors of the S&P 500. Cloud computing, software developers, gadget makers, streaming services, social media companies, enterprise networking systems, AI & ML based tech, and other organizations that are heavily infused with technology fall under this sector. Those stocks that are reasonably valued and have great growth prospects have the potential to thrive in the tech domain. Unfortunately, these leading tech space organizations are largely based in tech hubs across Silicon Valley, Singapore, London, Japan, China, and beyond, thus the need for global diversification.
The upgrade - Technology investment for wealth managers
While investors focus on ‘tech stocks’, financial advisors need to shift their focus to ‘tech stacks’ that change the way they do business. Drawing insights from a large amount of transactional data, streamlining processes, improving efficiency, reducing risks and better-optimized portfolios are some of the benefits of including a tech-based backbone in daily operations. Individual advisors that lack the bandwidth and financial support to build such systems can turn to Fintso for their white-labelled IFA advisory support services, cutting-edge mutual fund distributor software and advisory platforms that assists advisors to incorporate the much-needed technology in their daily functionalities, processes, and client touchpoints.
Easy accessibility to global investments through Fintso
Another benefit of partnering with Fintso is the opportunity to seamlessly assist your investors while they diversify their investment across the globe. Creating portfolios, that are well-diversified, while attempting to navigate the intricate web of complicated requirements across international markets can be a challenge. Additionally, you wouldn’t want all your investments in FAANG alone, right? Fintso’s thematic baskets of international stocks and ETFs backed by strong research assist advisors to offer their investors the best global investment opportunities beyond marquee stocks too.
The opportunities to grow your business beyond its current share of wallet, to diversify investments, and to grow your customer’s portfolios beyond Indian borders are endless with Fintso as your partner.