GCA Advisors: ‘The market is very volatile’
GCA advisers are facing a barrage of requests to close accounts as they struggle to cope with the unprecedented surge in interest from investors.
The Australian Securities and Investments Commission has issued a warning to clients in the space and warned that there is a risk of a sharp correction, as more investors are trying to get in on the action.
“The market for investment advice has increased dramatically in the last year, and the current environment may be volatile,” a spokesperson said.
More than 5,000 advisors have applied to close their accounts in the past two weeks.
GCC chief economist and financial planner, Anthony Hsieh, said there had been a sharp increase in demand for the sector, and some advisers were “going out of business”.
“We’re seeing people applying for hundreds of thousands of dollars of investment advice, often for advice that would be better left to the professionals who specialize in the same issue,” Mr HsieH said.
“It’s hard to believe there will be an even broader and more widespread response to the market.”
Mr HsieP said a number of clients were being asked to pay up to $2,000 to close an account, and he had also seen clients getting inquiries from investors seeking advice on other topics.
Many are also being told they need to take action in order to be deemed accredited.
In a statement, Mr HsuY said: “GCA has had some very challenging periods in the market and we’ve seen some very large clients seeking our advice.
We’ve been hearing a lot of stories about how clients are struggling to make ends meet and are struggling with the increased demand for advice.””
As we’ve said before, there is no silver bullet to managing a complex market, but we’re doing our best to help people understand the importance of making good decisions.”
A spokesman for the Australian Securities Trading Commission said there were “significant issues” in the sector.
“[It is] a real concern for the market as a whole,” he said.
“There’s no doubt it’s been a very difficult time for some advisers.
But the commission has been able to work through the issues and it appears the current regulatory framework is the right one.”
GCA is a part of the Financial Services Group, which oversees investment advisers.
The company has a history of offering advice to clients on investment banking, financial planning, and asset management.
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