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In India, many individuals inherit significant wealth from one generation to another, and many people hold high-paying jobs or run traditional family businesses. Often, these people want to explore investment opportunities, but they are not able to experience them because of their workload or lack of investment knowledge. But as the investment world grows, it has come with several investment opportunities.Many people make their own investment decisions, and they invest directly in stocks, gold, and bonds. Some become successful with low to moderate returns, and some face losses due to a lack of skill and expertise.

 Remember, to earn good returns from your investments, you need to manage them effectively. You need the help of an expert who can invest your money wisely and make necessary adjustments over time. For this, there is a type of service called Portfolio Management Service (PMS). In PMS, specialised experts manage your money according to your needs. So, as an investor, you get the help of market experts.

What is PMS?

In simple terms, PMS means a special service in which experienced financial managers manage your investments under your supervision. They analyse your goals, risks and expected returns and prepare a special investment plan for you.

Types of PMS:

Discretionary PMS:

In this type, you give your investment amount, with your investment objective, risk appetite, and investment duration to the portfolio manager. Then he manages your money based on your selected parameters. he decides which shares to buy, which to sell, and for how long to hold them. He does not need to ask your permission. This is useful for investors who do not have much knowledge of the stock market or do not have time, but have complete trust in an expert. His responsibility is very high, but the risk can also be high.

Non-Discretionary PMS:

In this type, the PMS  manager gives you investment advice. He cannot do any buying or selling without your permission. He will tell you, "Buy this share", "Sell this share". Then he executes that order only after you say "Yes". Here, the final decision is yours. This is useful for investors who have some knowledge of the stock market, want to make their own decisions, but want the guidance of an expert. You have more control, but you also have to spend more time.

Advisory PMS:

This is a little different. Here, the PMS  manager only gives you investment advice. That is, he will tell you which stocks to invest in, what percentage of money to keep in which sector, and how to build a portfolio. But you have to do the actual work of buying and selling (execution) yourself, from your regular brokerage account. The fees for this are usually low. This is useful for investors who want expert advice to build a portfolio, but have the ability and time to do the buying and selling themselves.

How does PMS work?

• You first contact the PMS service provider.

• You have to tell your financial goals, risk appetite, and investment horizon.

• Accordingly, the portfolio manager prepares a special plan for you.
  
   
• That plan changes from time to time according to the market situation and provides you with regular information.

• All investment and sale transactions are done in your name.

•  You know the performance of your investment from time to time.

Advantages of PMS:

Expert management:

 Important benefits of  PMS are that your money is managed by experienced experts. They manage your portfolio and try to increase your profit.  

Customised investment:

Investment is made according to your needs and goals. They make changes in their plan according to our investment capacity, objective and risk appetite.

Regular updates:

The portfolio manager is, main key caretaker in this journey. They regularly monitor your portfolio, and they provide detailed information about your investment.

Risk Control:

Risk is reduced by allocating money across different investment vehicles. They diversify and modify your portfolio according to market conditions and your objective.

we have understood the definition, types of PMS and benefits of PMS. But with the benefits of anything, there are also some limitations or conditions.

This is true about PMS also. So, let's understand some of the main limitations of PMS and important SEBI rules.

Limitations of PMS:

Minimum Investment:

When you invest in a particular stock or a mutual fund by yourself, you can start investing from only  100 Rupees or less.  But,  to get benefits from PMS, you must have an investment fund of at least Rs 50 lakh.

Fees can be high:

PMS fees can be high when compared to mutual funds. In a mutual fund, money is pooled together and invested in a particular scheme based on the fund's ideology. In PMS, money can be invested and modified accordingly needs of the investor.

Risks:  

PMS  is a high-risk, high-return investment scheme. Suitable only for experienced investors, as the risk can be high.

Limited Availability:

PMS is usually for investors with high amounts of funds. We often call this investor a high-net-worth individual (HNI).

FAQ:

1. What is PMS?

Ans: PMS stand for portfolio management services. It is a scheme in which a personal portfolio manager is deployed to manage and modify your investment.

2. What is the cost of PMS?

Ans: Generally, the Cost of PMS depends upon the PMS provider.  Most of the PMS providers take 0.25 to 3.5 %  of the total investment value.

3. Which is the best  PMS company in Pune?

Ans.  Finshak is one of the well-known and leading PMS, Mutual fund, and insurance service providers in Pune.

4. PMS near me?

Ans: No need to think whether you are near or far, you are always in our hearts. Contact Finshak for more details.

5. Which is the best PMS provider in India?

Ans: Finshak has become one of India's leading investment platforms for its services across the mutual fund, insurance, PMS, fixed deposit and bond.