The Indian merchant bank AK Capital Services is entering the wealth management space with the recent launch of a unit focused on advising high net worth individuals on fixed income opportunities.

AK Wealth Management, the new firm, received a go-ahead from the Securities and Exchange Board of India in July to open up portfolio management to HNW individuals; AK Capital originally focused on institutional investors, such as mutual funds and insurance firms.

"Equity investments are often buffeted by sharp volatility. In sharp contrast, investments in rated bonds fetch steady, albeit lower, returns and the principal is also protected. HNW individuals want to strike a balance between these two categories of investments. As we specialise in debt markets, we decided to float a wealth management subsidiary that will focus on advising HNW individuals on fixed income investments," AK Mittal, the managing director of AK Capital, said in a release.

Mittal added that as his firm knows all the bond issuers in the market it is in a strong position to advise clients on such investments, be they institutions or private clients.