Why Winvesta

Why form trumps substance in providing a regulated financial service

If you are reading this, you are likely serious about becoming a global investor. Congratulations on taking that first step! This note aims to provide you with context on how we are building Winvesta and where we are heading.

I’ve spent almost my entire career in financial services, being firstly a trader in a bulge-bracket investment bank in London and then founding Winvesta. I learnt early in my career that in Financial Services, we aren’t in the money business. We are in the business of trust. In providing any regulated financial service, form trumps substance. After all, the raw material is money. It’s fungible. The regulatory structure in India to invest overseas is grey. When we decided to provide a platform to enable Indians to invest overseas, we were clear that we needed to provide it in an honest, transparent structure keeping the client at the centre and afford him all the protections that he deserves.

The management team together has over three decades of experience in financial services and thus providing the appropriate form for any service is of paramount importance. You can see more about the team here. Our Advisory Board is an extremely illustrious set of individuals with deep expertise in Global and Indian Financial Services and Law. 

The problem statement we wanted to address was straightforward – if a client wants to invest in a US-listed company (say Amazon), how do we provide the correct platform to him?

Being a SEBI registered broker was irrelevant as the broker membership is linked to domestic stock brokerages. We are providing access to securities listed overseas. 

Being a SEBI registered Investment Adviser significantly amends the nature of the relationship. As mentioned previously,  form is important. An adviser shouldn’t charge clients for self-directed investing. Being registered as an Investment Adviser overseas is against the age-old spirit of providing investment advice – given that it must be provided at location of the client. 

The most appropriate solution was to be registered as a broker overseas that can take on clients from India. 

The City of London is the pre-eminent global financial services centre. More American banks have an office in London than in any single city of the United States. With Indian law’s roots in English Law we believe that it’s the best and most appropriate form to have us registered as a broker with the UK’s Financial Conduct Authority (FCA) to provide these services. It also provides us the most appropriate ability to service our clients for the UK / European investment needs.  Our US-based broker dealer is already known to many in India. Our FSCS protection of GBP 85,000 complements the SIPC protection of USD 500,000 offered by them. Thus our platform provides all the protections that a US investor would have locally, as would a UK-based investor.

The world is moving towards a zero-commission model. There is little reason that resident Indians should pay onerous transaction fees which were previously charged by US brokers to their domestic clients. We have taken a principled view that we will offer a free version of our platform always. And when we charge you any fees, these are reasonable and clear. No significant upfront costs. No annual tie-ins. We let your money do the hard-work and grow, rather than pay nose-bleeding fees.

Our communications are honest. Our terms and conditions are clear and in plain English. A 10 year old could read them. It says what it does on the tin. No obfuscation, no misdirection.

While we have a set of partners that help us deliver our services, we are clear that we owe direct responsibility to our clients. We perform the KYC ourselves and always open the accounts within a day. 

As we launch our services in lockdown, we couldn’t be clearer on our mission. However, it is day 1 for us. Our product isn’t perfect, but we are committed to listening to our clients. We will use the best of our experience to keep innovating and adding products for you – our clients.

What you will always get from us is the plain truth and honest opinions.

We look forward to serving you.

Swastik Nigam
Founder & CEO, Winvesta