PMS - Portfolio Management Services

PMS is a SEBI licensed investment platform for investing in a portfolio of securities and managed by a Portfolio Manager. The underlying securities in a portfolio can be stocks, fixed income, mutual funds, cash, structured products and other individual securities or any other securities. In a PMS, a client's portfolio is unique and can potentially be customised to meet specific investment objectives

A Portfolio Manager is the entity, offering (PMS) services of advisory and/or the management of a portfolio of securities of the clients on their behalf. In India, a Portfolio Manager must be licensed from SEBI to be able to offer PMS to clients.

An investor can invest fresh money in PMS and the portfolio manager will construct a portfolio by deploying that money. The investor can also transfer his existing (mutual funds) portfolio to the PMS offered. In such a case, the portfolio manager will revamp the portfolio in line with the strategy and investment philosophy.

Types of investment services in PMS

There are two types of PMS generally offered to the clients. They are as follows:

  • Discretionary PMS - It is the one, where the Portfolio Manager individually and independently manages the funds of each client in accordance with the needs of the client. The Portfolio Manager takes all the investment decisions, executes and manages the administration of the portfolio.

  • Non-Discretionary PMS - Where the Portfolio Manager generally makes recommendations to the clients and investment decisions are made by the client. The Portfolio Manager merely executes and manages administration of the portfolio on the directions of the client.

In India, the discretionary PMS is more popular and widely offered, since it offers the benefits of customised portfolio management by professional & experienced portfolio managers.

Rationale for PMS

Discretionary PMS is an attractive investment product for investors owing to its many unique benefits, which stated below.

Professional management of your portfolio by experienced professionals

Personalised focus on your unique portfolio

Continuous monitoring and regular review of your portfolio

Scope for customisation, personalised portfolios based on specific needs / objectives of the investors

Hassle free operations with high standards of service and complete portfolio transparency / reporting

Controlled risk owing to strong internal processes / systems in portfolio management and research driven approach

Freedom from taking investment decisions and managing administration of portfolio


Tax benefit

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