Money Bazar

A financial adviser is a professional who provide investment advice and financial planning services to individuals and businesses. Ideally, the financial advisor helps the client to maintain the desired balance of investment income, capital gains, and tolerable level of risk by using proper asset allocation. Financial advisers use investing options to meet the needs of their clients.

All financial and investment advisors are regulated by a single regulator, the Securities and Exchange Board of India (Sebi). The Sebi is likely to regulate them through a private sector self-financing regulatory organization. Sources said the government and the Sebi had agreed that the market regulator would begin the process of registering and regulating investment advisors and distributors in the securities market. The Sebi has expressed concerns that unregulated advisors may have some hidden schema behind giving certain advice, which could be harmful to the investors' interest. The sources also said that advisors might have to give an undertaking to the regulator that they would follow fair practices in other advisory functions not regulated by the Sebi, when they registered with the Sebi.

There should be a single regulator for investment and financial advice for effective regulation. But a consensus is hitherto to emerge among all the regulators concerned. The ideal view is that the Sebi should regulate all types of financial and investment advisors.