Portfolio Management Schemes involve taking custody of your cash and managing it on your behalf. There is a minimum investment limit of Rs 50 lakhs (five million) in a PMS.
PMS are of two types:
- Non Discretionary – You get a list of stocks and advice and the portfolio manager does not get the discretion to implement.
- Discretionary – Here the portfolio manager has the freedom to implement the advice; they usually take a Power of Attorney for your Demat account. This is the most prevalent model in place.
Most investors look to invest in a PMS for higher returns. One alternative to consider would be an Equity Advisory run by a SEBI Registered Investment Advisor who would not take custody of your cash or units. You would get advice to invest in a suitable set of equities.
Disclaimer:
I am a SEBI Registered Investment Advisor, however the answers here should not be considered as investment advice. Please contact me via the information shown in the profile for any investment advice related to direct equities or other investments.
