How Do PMS Schemes Work?
Are you an ultra high net-worth investor and looking for better investment opportunities that offer customized stocks portfolio? You are at the right place, Portfolio management services or PMS is the best option for you. Here we will try to know everything about Portfolio Management Services and choose the best PMS in India.
Popular & Individualized Investment Option
When you choose the PMS scheme, your bank, Demat & trading account will be opened separately under your name and investments will be made under your name. Hence, any income/dividend coming from your investment will be credited into your bank account.
This means you hold all your stocks individually, not like mutual funds, where there’s the pool of funds that are managed by the Best PMS Company in India and performance will be evaluated based on daily NAV. Every fund performance will be influenced by the investor’s sentiments, while in PMS, the behavior of the individual investors will be isolated from each other.
Choosing the Registered Investment Fund Advisors
For managing your portfolio, you can take services of the SEBI registered advisors. The advisors can help you to create the portfolio of mutual funds and stocks depending on your risk-return profile & financial goals that you have set for yourself. The best PMS in India normally works on two basic models –remunerative model or fixed fee model.
Remunerative Model– the lower flat fee and returns percentage will be generated. And latter is charged for returns formed in excess of the predetermined rate.
Fixed Fee Model – The advisors will charge a certain fixed fee for managing your portfolio. It includes rebalancing your current portfolio
Benefits of Investing in PMS Funds
· PMS assures to outperform benchmark that is you get greater than benchmark in a long run.
· Diversified and focused portfolio as per your profile.
· The portfolio of debts and stocks monitored and managed professionally.
· There is no limit to an extent you will invest in some stock.
· The professionals at PMS AIF World will understand your requirements and invest in a most preferred segment.
· You can invest over asset classes –equity, debt, mutual funds and gold.
Drawbacks of Investing in PMS Funds
According to the SEBI guideline the minimum investment needs to be INR 25 lakhs (has increased to INR 50 Lakhs from Jan 2020) due to which the small investor cannot enjoy the services provided under PMS.
· Long documentation process to open your trading account, Demat Account, and bank account
· PMS providers won’t share losses.
· Huge set up cost –Investors need to pay 1 to 2 % of AUM that is an amount you wish to invest, at a time of your investment. With this you need to pay the yearly management cost too.
Final Words
As the stock market is known to have a lot of fluctuations, your risk factor in high-value assets will be always more. But, the professional and Best PMS Company in India will help to reduce your risk just diversifying it. This is the reason you must look to invest in the Portfolio Management Services.
