Some of the myths..that we told you and ..well…lets see what they are:

1. Your interest and your broker’s interests are aligned: Sorry. This used to be true when we were a few individuals who knew the customers, spoke to them, planned for them etc. Today your broker employs ‘relationship managers’ who have revenue targets, and love action in your portfolio. Remember inaction makes money for you and activity makes money for the RM. He will be eager to see you jump from one branch to another. For you to align your interest with your broker’s RM is not just difficult, but almost impossible. It would be good if you can do a lot of it yourself instead of depending on somebody else who is almost at cross purpose with yourself!
2. You get what you pay for, so more you pay, better you get: Not true at all. Unless you are well informed, and KNOW what you need (and therefore ask for it)..you will not get what you need, require or deserve. Most investors outsource their portfolio to professional money managers who supposedly perform be/er because, well, they’re “PROFESSIONALS”! But the money management business is just like any other business. Not everyone is good at it. Research shows that over 80% of professional mutual fund (and hedge fund) managers under-perform the index in the USA. The reality on Wall Street is that most professional money managers cannot outperform an index and add very little value over buying a simple index fund. However, in India the fund managers seem to be earning their fees – but only a few of them. Actually if you are not too keen to monitor your portfolio you are better off being in an index fund and let the markets do the monitoring. RIP.
3.  Buy and Hold is the ONLY THING to do: Not always true. You need to be passively looking at your portfolio and taking remedial action. You may have to even as a passive investor do a few trading activities.Many investors think they can just put a portolio on auto-pilot and never have to look at it again. I get calls saying “tell me what to buy for say 30 years”. Hey the devil is in the details. Proper investing and risk management means proper diversification based on your needs. And this requires proper understanding of a portfolio aligned with YOUR goals and needs. This requires maintenance, rebalancing, risk adjusted rupee cost averaging and proper monitoring and aligning with your requirements and personality. You don’t have to be a trader or rely on  “professionals” for this, but on auto-pilot you are likely to be in the bottom, not top.
4.  You need to invest with a big brand: Completely wrong. Parag Parikh, Motilal Oswal, Nirmal Jain – were all unknown about 20 years ago. All of them are now big in the wealth business. Far bigger than banks which may have made a mess of their portfolios. At least in Parag Parikh, Franklin Templeton, etc. you can be sure that there is no conflict of interest. Bigger the conglomerate bigger the conflict that you need to worry about. So stop getting carried away by the brand image.
5. Investing (SIP) will make you Rich: well, it is earning well that will make you rich. Investing will protect your money against inflation. A good IFA will protect you from major losses. This combination will help you preserve capital in REAL terms. You need to do SIPs – starting from a small fund and taking it to a high figure over a period of time.

Marriage? be careful boys and girls!

Well there are more…