A Portfolio Management Service (PMS) is a customized investment product that is tailor designed to meet your specific investment objective. In a PMS you invest in stocks, fixed income instruments, cash, structured products and other individual securities, managed by professional portfolio managers.
A PMS provides you a tailor-made investment solution based on your specific investment objective whereas a mutual fund is a common pool of money collected from investors with a similar investment objective. The securities remains in your de-mat account unlike mutual funds, who owns the units of the a mutual fund scheme.
You can avail the services of PMS via three different ways: Discretionary, Non-Discretionary and Advisory.
In discretionary PMS, the portfolio manager takes the call and so the investment decisions remains with the portfolio manager only.
In non-discretionary PMS, the portfolio manager executes the transactions in consultation with the client and so will not be able to make independent decisions.
In Advisory PMS, the investment manager advises the client on for his investments and so the investor manages his own portfolio based on the recommendations of the portfolio manager and his own market knowledge.
But, In India majority of Portfolio Managers offer only Discretionary Services.
The Investment options provided by PMS suited to High Net worth Individuals or Institutions.
The client gives the Power of Attorney to the Portfolio manager to manage investments on his behalf.
- Custom Design.
- Regular monitoring and so periodic changes are made to optimize returns.
- Concentrated portfolios.
- Detailed regular investment updates.
- Professionally managed by specialists.
- Audited statements at end of each Financial Year to assist client for tax filing.
- Flexible in nature in holding cash depending on market conditions.
Depends on the product and the portfolio manager. But in general, the PMS starts with a minimum investment amount of Rs.25 lakhs in cheque or an equivalent valuation security, which generally will be liquidated.
We at RUPEESTOP brings you the best from the products offered by various portfolio managers and post your selection of the product your investment will be managed by Portfolio Managers along with a team of research analysts.
Yes, but only for the purpose of hedging and portfolio rebalancing and not for leveraging.
No, under the regulation of SEBI Portfolio Manager cannot guarantee returns.
Depends on the product and the portfolio manager as there is no prescribed scale of fee. The portfolio managers allows you to opt form fixed fees or variable fees or combination of both, in addition to actual expenses like custodian expenses, audit fee, brokerage on transactions.
You can access your investment details online anytime and will also receive regular reports on performance and portfolio allocation. You can monitor the portfolio performance via various statements and reports made available to you.
Every transaction in a PMS is independent in nature and will be taxed similar to that of securities held in capital market. Investor should consult his tax consultant for details.
Audited statements will also be provided by the portfolio manager at end of each Financial Year to assist client for tax filing.
All investments involve a certain amount of risk, which varies depending on the security selected.
But portfolio managers apply due care while selecting a security and so the expertise and knowledge of the portfolio managers convert the risk to calculative risk.
- Resident Individuals
- Partnership firm
- Sole proprietorship firms
- Body Corporate and Association of persons
- Limited Company
- NRI (an NRI have to open a Portfolio Investment Scheme Account in accordance with RBI guidelines)
Most of the PMS schemes allows you to book profits till the time your portfolio‘s value does not fall below the prescribed limit of Rs. 25 Lacs, as per SEBI regulations.
Yes, De-mat account mandatory to invest in PMS.