Monday, November 10, 2008

Totally disagree with what the MM said

Just read today's news that MM mentioned that the investors should have kept their eyes open. If the interest rate is 1%, and they are getting 5%, there should be a catch.

The whole problem is nothing to do with if there's a catch or not! The problem is that you ask all the relationship managers (RMs) and financial advisers (FAs) to go through so many courses, which in the end becomes useless paperwork that does not count. Why on earth do you need a fact finding analysis if in the end, you're not going to take into account the findings from that analysis?? It totally defeats the purpose. You might as well just throw away the analysis!

And over here, we're talking about mis-selling. There is a whole lot of difference between someone telling me that the 5% interest rate comes with a catch where you might lose your principal, and the 5% interest rate is as safe as fixed deposit. And mind you, this is coming from a person supposedly with all the certs that makes them qualified to give financial advise. Worst still, some investors have never even seen the prospectus of the product.

As evidence on how transparent our financial sector is, only now do I know that there are 3 types of financial advice that the advisers can give you:
  1. Full Advice
  2. Partial Advice
  3. Product Advice

I thought there was only full advice. Period.

We do not even know the 3 categories of advices that we're suppose to be getting. If we do not even know this simple fact, how do we keep our eyes open?

It's like saying that we should keep our eyes open, but the danger is actually what we cannot see. Furthermore, this advise is not supposedly given by any Tom, Dick or Harry. It's given by a certified adviser. What will happen to a doctor if he/she prescribe the wrong medicine?

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