Investment Adviser
A SEBI-registered professional who advises on securities for a fee and owes a fiduciary duty to the client.
How it is identified
Test: the person holds a SEBI registration as an investment adviser and charges a fee for advice rather than earning commission on products
Unit
qualitative
In depth
The registered investment adviser regime separates advice from distribution: an adviser charges the client directly and cannot also earn commission on the same client's products, which removes the conflict that makes distributor recommendations hard to evaluate. Fees are capped by SEBI under prescribed models. This is a materially different relationship from a mutual fund distributor, who is paid by the fund house through the expense ratio and is held to a suitability rather than fiduciary standard. Checking registration, and asking how the person is paid, are the two questions that identify which relationship is on offer.
Worked example
An adviser charging ₹40,000 a year for advice on a ₹40,00,000 portfolio costs 1%. A distributor recommending regular plans earns roughly 0.9% a year embedded in the expense ratio, which is not itemised anywhere the client sees.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Investment Adviser” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.