Portfolio Management Services

Portfolio Management Service

Investing in Portfolio Management Service (PMS).

Investing in portfolio management services is one of the most preferred option for NRIs to grow their wealth back in India. In PMS the investor would own individual securities whereas in mutual funds the investor would own units of the fund. Another key distinguishing factor or advantage that PMS has over mutual funds is that the performance of the PMS is not affected by the inflow and outflow of money as it does in mutual funds.

PMS is the preferred choice of investors when it comes to achieving a pre-planned goal. PMS offers diversification and personalized investment solutions for long-term wealth creation. PMS is the ideal route by which the investor can own the stocks in his own name while using the expertise of the fund manager. PMS is very dynamic and can be altered at any time based on the ever-changing conditions of the stock market. This offers a great advantage to PMS investors as they will make the most of any fluctuations in the stock market.

Can Non-resident Indian (NRI) invest in Portfolio Management Services (PMS) in India?

NRIs are allowed to invest in Portfolio Management Services in India– as long as they adhere to the rules of the Foreign Exchange Management Act (FEMA). However, some Asset Management Companies (AMCs) do not accept PMS applications from tax residents of Canada & USA and some has restrictions over online investment transactions.

Key Elements of Portfolio Management Services:


Pre-requisites for PMS Investments:

Type of IncomeTaxation levy in IndiaTDS rate (Withholding tax rates)*
Sale of Listed Shares – STT paid at the time of purchase and sale (except for shares purchased before STT came in force). Period of holding less than 1 year – Short Term Capital Gain.
Capital gain @ 15%. (U/s. 112A)
15% (U/s. 195)
Period of holding more than 1 year – Long Term Capital Gain.

Capital gain @ 10%.

Exempted up to Rs. 1,00,000.

(U/s. 112A)
10% (U/s. 195)

A Portfolio Management Service (PMS) is a service which provides professional management of investments to create wealth. It aims to cater to the investment needs of individuals or entities with high net worth value by providing them with investment solutions.

Advantage of equities as an asset class

Solutions customized to the needs of HNIs

Personalized attention

Portfolio Managers take buy/sell decisions on behalf of, but in consultation with a client
Portfolio Managers regularly interact with clients to update them on portfolio strategy, performance, and market outlook

Better handholding from his portfolio manager than he has been accustomed to either on his own or from his broker or mutual fund.

One can also expect to interact with the portfolio manager to discuss any concerns that he might have, though not frequently.

All administrative matters, including operating a bank account and dealing with settlement and depository transactions, will be handled by the Portfolio Manager.<.li>

The minimum ticket size of the portfolio we offer is Rs. 50 lakhs. There is no upper limit on the amount you can invest.

Under PMS, your portfolio is managed by a team of Portfolio Managers supported by research analysts. These specialists create and actively manage your portfolio to provide you returns in line with your stated investment objectives.

The fixed management fee being charged is much lower than that charged by others. We have consciously kept our fee more performance linked, as we strongly believe that it will align the interests of the firm and the client. It also incentives the Portfolio Manager since they have a stake in the profitability of the portfolio.

Here’s why you should opt for Portfolio Management Service:

The objective of Portfolio Management Service is to create wealth by delivering consistent long term performance with risk control.
1) PMA tracks the portfolios constantly by understanding the dynamics of equity as an asset class.
2) PMS got a defined investment philosophy and strategy which acts as a guiding principle in defining the investment universe.
3) PMS make sure that you are relieved from all the administrative hassles from your investments. We also provide periodic reports on the performance and other aspects of your investments.

Yes, you can opt for portfolio management services if you’re a Non-Resident of India (NRI). You will have to open a PIS account as required under RBI guidelines in order to invest in the PMS scheme.

Yes, for few portfolios a combination of cash and stocks can be paid to open a PMS account. The securities/shares in the initial portfolio will be realigned to fit the model portfolio.

Yes, the investor can book profits anytime they want. But as per SEBI regulations, the portfolio should not fall below the prescribed limit of Rs 50 Lakhs.

You are advised to consult your tax advisor for your specific tax consequences. The portfolio manager shall not be responsible for assisting you in fulfilling your tax obligations. Provisions of the Income Tax Act, 1961 will be applied to your manager in respect of your individual income.

Basically AMCs offer two types of Portfolio Management Services, discretionary as well as non-discretionary. In the discretionary portfolio management service, the discretion to invest primarily lies with the portfolio manager. Under non-discretionary services, the client decides his /her own investments. The portfolio manager is responsible for providing advice and facilitating the execution of transactions. The Portfolio Manager’s role is limited to providing research, investment guidance, and trade execution at the client’s request.

Fund Manager of PMS sends out the following reports to help you monitor the performance of your folio.

1. Fortnightly reporting: This gives you information like the portfolio net worth, a monthly report of holding, and bank balances
2. Quarterly reporting: This gives you details of portfolio holdings/transactions, net worth, ledgers, fees, corporate benefits, etc.
3. You’ve got access to the website showing client holding & quarterly reporting of portfolio holdings/transactions.

Yes, Portfolio Management Services completely supervised by the regulator of capital markets in India, SEBI. PMS can be offered only by entities having specific SEBI registration for rendering portfolio management services. Currently in India, it is offered by specialized PMS players, asset management companies (AMCs), and brokerage houses.

The minimum initial investment amount for these products is Rs. 50 Lakhs. This shall be invested across various products by the portfolio manager. The distribution may change according to the discretion of the portfolio. The fees and charges may be different according to the customization demanded by the client.

In the case of discretionary Portfolio Management Services, withdrawals and investment in various model portfolios would be at the discretion of the portfolio manager. In the case of non discretionary Portfolio Management Services, the said movement would be done post confirmation from the client.