Opening a financial advisory company
Making an investment is a serious, delicate and high-risk business. Both individuals and companies can benefit greatly from the results of a good investment, but one must have the knowledge and time to develop a strategic plan, which is neither easy nor quick. The solution seems to be in the hands of a financial advisory company, which is responsible for making a plan tailored to each need, trying to obtain the best return for the client.
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Investing money can determine our financial future for many years to come, so every decision may be the last and chance is not an option. A financial advisory company has the necessary professionals to develop a plan adjusted to the possibilities and needs of each client and ensures that the investment is made based on thoughtful decisions and based on a thorough market study.
Novice and experienced investors who prefer to be supported by professional advice choose a financial advisory firm because it provides the following services: global equities, global bonds, emerging market bonds, cash management, investment in different currencies, investment account line, margin accounts, customized structured products, derivatives, alternative investments, comprehensive and traditional accounts, among others.
What it offers
In addition to the services mentioned in the previous paragraph, the financial advisory firm offers a service that begins when the client contacts the firm and ends long after the client finally makes his investment. The most effective process and that maś provides security to the client is the following:
Target Research: The first thing you need to find out as a financial advisory firm is your client’s goals. Among them are becoming a millionaire, living with average income from investments, obtaining a significant amount that allows you to pay certain debts, among many others.
Capital analysis: another important piece of information is to know how much capital your client has to make the entire investment. This information, together with others, will allow you to determine whether it is convenient to make a single investment or several, while determining the degree of risk that can be assumed.
Investor profile: this information is very important; a shy investor who is only willing to take the slightest risk is not the same as a reckless one who is willing to risk everything.
Elaboration of the strategy: the three previous data will allow you to elaborate a strategy of investment to the measure of the client, which you will present to him in writing and you will explain him step by step.
Implementation: at this stage the plan is carried out and the client invests his money.
Follow-up: this step does not have a marked end, but rather it is about accompanying the client throughout the entire stage after having made the investment, in order to give him security, confidence, guidance and to verify that he has achieved his objective.
Important data for a financial advisory company
A financial advisory company needs to be set up in a good office, equipped in a neutral way and with a certain degree of formality. This is important when receiving clients.
The staff should be mainly economists and accountants and it is very important to have a neat, formal presence and to dress in neutral colors.
Requirements to start a financial consulting company
The first requirement is to establish how the service is to be provided, which can be as a professional or as a service company. Each alternative has its advantages and disadvantages.
The Professional Companies Act makes it compulsory to consolidate as a group and meet the requirements for creating a company, and if this is not done, it can be closed automatically. Therefore, experts recognize that it is better to comply with the regulations, to avoid closure by order of a judge.
The figures of both professional and individual firms are responsible for providing the advisory service but also for the result of the same and are accountable to it in a total, universal, collective, subsidiary and communicable way, both in society and individually.
They are responsible for drawing up the contract for the provision of services, this being the most appropriate means of establishing relations with the client. Including the obligations that are agreed upon.
Advantages of having a financial advisory company
In the first case, the individual professional, in exchange for greater customer loyalty, is faced with the real limitation of growth and reduced investment capacity
investor. Whereas, with a service company there is a better chance of growing and surviving the setbacks of the owner, facing technological and financial challenges.
The management and consulting firms set the price of the fees, depending on the services they provide, the complexity of the procedures required by the client and the tax offices in the area.
In the case that they carry out fiscal or accounting tasks, many professional offices charge for the services based on the number of invoices they have to account for. In the case of labour consultancy, they usually set the fees based on the number of employees.
Tips for starting this business
The consulting business is responsible for both the service and the result of the service, responding in a total, universal, collective and subsidiary way. Therefore, it is necessary to have a Civil Liability Insurance that covers any error that may be committed.
In order to set up the consultancy centre, the entrepreneur must have the appropriate training and experience for the service he or she is providing. It is advisable that this preparation be a university degree, through specialization courses in the subject and previous experience in the field.
Having the academic degree that accredits it provides the necessary knowledge for the activities to be developed, such as Law, Labor Sciences/Labor Relations/Social or Economic/ADE/Business, among others.
Problems that can be presented by a financial consultancy company
A problem that can arise is when you want to cover all business models, to capture as many customers as possible. Therefore, taking into account the chosen business model, the legal format, the target audience, a differentiation must be established. Although at first you may be tempted to accept all types of customers, it is important to try to focus as soon as possible on a niche or a specific group of customers.
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