Portfolio

Management
Services
 Introduction
Welcome to our presentation on portfolio management
services. Today, we'll be discussing the benefits of using these
services and how they can help you achieve your financial
goals.
Investing in the stock market can be a daunting task, especially
for those who are new to the world of finance. Portfolio
management services provide a solution by offering
professional expertise and guidance to help you make informed
decisions about your investments. By diversifying your portfolio
and managing risk, these services can help you achieve long-
term success.
 What is Portfolio Management?

Portfolio management refers to the art of managing a

collection of investments, known as a portfolio, with the goal of
achieving specific investment objectives. This involves making
decisions about what assets to include in the portfolio, how
much to allocate to each asset, and when to buy or sell them.
Unlike other types of financial management, such as individual
stock picking or market timing, portfolio management takes a
more holistic approach to investing. Rather than focusing on
individual securities or short-term market movements, portfolio
managers consider the big picture, taking into account factors
such as risk tolerance, time horizon, and overall investment
goals.
 Details of PMS
Portfolio management services or PMS offer customised investment solutions to
investors to help them attain their financial goals. Portfolio management services
construct investment portfolios across various investment options, and portfolio
managers take care of the investment portfolio. Portfolio managers offers PMS with
the intent to achieve the required rate of return within the desired level of risk
PMS is a systematic approach to maximise returns while minimising the risk factor on
your investments. It enables you to make sound decisions that are supported by
extensive research and factual data without lifting a finger. Additionally, it better
prepares you to deal with market adversity.
Many High-Networth Individuals (HNIs) opt for portfolio management services as
tailor-made portfolios are constructed after considering investment horizon, risk
tolerance, liquidity, and taxation. Moreover, entities offering PMS services must be
registered with SEBI, eliminating fraud and malpractices.
Portfolio management services are popular among HNIs, HUFs, partnership firms, NRIs,
Association of Persons, Sole Proprietorships etc. Portfolio management services
specify a minimum ticket size for investor portfolios. Currently , Minimum ticket size is
Rs. 50 lakh.
 Types of Portfolio Management Services
Active Portfolio Management
This form of portfolio management aims
at beating the performance of a market
index such as Nifty
High degree of risk involved as well as
higher returns.
Discretionary Portfolio Management
The portfolio manager is given complete
control of the portfolio and is free to
adopt any strategy which is suitable to
the IPS.
It is cost effective and there is less client
involvement.
Passive Portfolio Management
Such a PMS strategy aims to mimic the
performance of an index by investing in the
same securities with similar weights.
Lower risk and lower returns than Active
PMS.
Non-discretionary Portfolio Management
The PMS will only suggest investment ideas while the investor will
be responsible for choosing the recommendation and timing.
It is less cost effective and client involvement is comparatively more
than Discretionary PMS.
Time period of portfolio management services

Portfolio management services can be categorized into short-term, medium-term, and long-term
management based on the time period of investment.
Short-term management typically involves investments for less than a year and is focused on
generating quick returns. Medium-term management involves investments for up to three years
and aims to balance risk and return. Long-term management involves investments for more
than three years and focuses on achieving long-term financial goals through diversification
and strategic asset allocation.
Some Key factors to consider before choosing a time period are Investment goals , Risk
tolerance and Market conditions.
CLIENT SUITABILITY
Client suitability is a crucial aspect of portfolio management services. It refers to
the process of matching investment strategies with the unique needs and
characteristics of each individual client.

By ensuring that clients are matched with appropriate investment strategies based on
their risk tolerance, investment goals, and financial situations , portfolio managers can
help them achieve their financial objectives while minimizing risk.

It helps to increase client satisfaction, reduce the risk of complaints or legal action, and
improve long-term performance.

To assess client suitability, portfolio managers use questionnaires and risk profiling tools to
gather information about clients' financial situation and investment objectives. Thorough
and accurate assessments are crucial to ensure that clients receive suitable investment
recommendations.

Overall, client suitability should be a top priority for portfolio managers.

 Benefits of Portfolio Management
Services

Portfolio management services offer a range of benefits for investors

seeking to maximize their returns while minimizing risk. One of the key
advantages is diversification, which involves spreading investments
across different asset classes and sectors to reduce exposure to any
one company or market. This strategy can help to protect against
losses and smooth out volatility in the portfolio.
Another benefit of portfolio management services is risk management.
Professional managers use sophisticated tools and techniques to
assess and manage risk, helping to ensure that the portfolio is aligned
with the client's goals and risk tolerance. This can include monitoring
market trends, analyzing economic indicators, and adjusting the
portfolio as needed to respond to changing conditions.
HISTORICAL
In the last 10 years, the
PERFORMANCE PMS industry added
OF PMS 63,550 clients and their
Assets Under
Management (AUM) have
grown manifold to Rs 2.5
lakh crore -- from Rs
22,614 crore in June 2012.
 Choosing a Portfolio Management Service

When it comes to selecting a portfolio management service, there are several factors to consider. One of
the most important is fees. You'll want to look for a service that offers transparent and reasonable fees,
with no hidden charges or surprises. It's also important to consider the investment philosophy of the service
provider. Do they align with your own values and goals? Finally, you'll want to review the track record of the
service, looking for evidence of consistent performance over time.

The top-10 PMS strategies account for Rs 59,129 crore of assets, which is just 2 percent of the entire
industry's assets put together. There are as many as 375 PMS providers registered with SEBI.
 Conclusion
In conclusion, we have learned that portfolio management services are
essential for achieving financial goals. By diversifying investments,
managing risk, and leveraging professional expertise, investors can
maximize returns and minimize losses.
When selecting a portfolio management service, it is important to consider
factors such as fees, investment philosophy, and track record. By doing so,
investors can make informed decisions and choose a provider that aligns
with their goals and values.
Thank You!