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PMS (Direct Equity)

PMS (Direct Equity)

Portfolio Management Services are a type of equity investments wherein a designated fund manager directly invests the investor’s money into selected stocks. Each PMS has a certain investment strategy which the fund manager follows to choose the stocks he wants to invest in. PMS is generally suitable for people who have sufficient resources to take care of their important financial goals and have surplus which can be invested in a potentially riskier instrument to generate higher returns. It is therefore suitable only to investors who have a very high risk appetite.

At CAGRfunds, we have partnered with some of the best Portfolio Management Service Providers. We evaluate each scheme to suit your profile and thereafter the recommend where you should be investing.
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FAQs - Portfolio Management Services

Portfolio Management Services (PMS) is an investment portfolio in stocks, fixed income, debt, cash, structured products and other individual securities, managed by a professional money manager that can potentially be tailored to meet specific investment objectives. When you invest in PMS, you own individual securities unlike a mutual fund investor, who owns units of the fund. You have the freedom and flexibility to tailor your portfolio to address personal preferences and financial goals. Although portfolio managers may oversee hundreds of portfolios, your account may be unique.

  • Discretionary: Under these services, the choice as well as the timings of the investment decisions rest solely with the Portfolio Manager.
  • Non Discretionary: Under these services, the portfolio manager only suggests the investment ideas. The choice as well as the timings of the investment decisions rest solely with the Investor. However the execution of trade is done by the portfolio manager.
  • Advisory: Under these services, the portfolio manager only suggests the investment ideas. The choice as well as the execution of the investment decisions rest solely with the Investor. Note: In India majority of Portfolio Managers offer Discretionary Services.

Individuals and Non-Individuals such as HUFs, partnerships firms, sole proprietorship firms and Body Corporate can invest in PMS.

The Investment solutions provided by PMS cater to a niche segment of clients. The clients can be Individuals or Institutions entities with high net worth. It is recommended that one should go for PMS solutions only after creating a sizeable Mutual Fund Portfolio.

Yes and No.

Similarity: Both PMS and equity mutual funds are a form of investment service wherein a designated fund manager invests your money directly in a concentrated basket of stocks.

> A PMS generally holds more concentrated portfolios as compared to most equity mutual funds. This makes it potentially more risky but also increases the probability of generating higher returns.

> The cost of investing in a Portfolio Management Service is higher than that of a mutual fund since a PMS fund manager is expected to manage investments with riskier investment strategies yet attempt to deliver superior returns.

> The stocks bought in a PMS are deposited directly in the Demat account of the investor. In a mutual fund, the investor is alloted units for the mutual fund he invests in. No stocks held by the fund are deposited into the Demat account.

Yes. An investor needs to invest a minimum of INR 25 Lakhs to invest in a Portfolio Management Service.