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About Portfolio Management Services
A Portfolio in Securities Market refers to basket of securities that a person has
invested into. Sometimes this includes Debt Instruments, Mutual Funds and even Bank
Balance in addition to regular equities. The person designated to manage the portfolio
is called Portfolio Manager. The Portfolio Manager advises, manages and administers
the securities and funds on behalf of the entrusting client. The service is offered
by a portfolio manager under a specific license from Securities and Exchange Board
of India. This service is very similar to the one provided by Mutual Fund Managers.
The difference between a Portfolio Management Service (PMS) and Mutual Fund (MF)
is that of customization. In most cases, MFs have preset schemes and investors join
and exit those schemes at various points of time at prevailing Net Asset Values
(NAV). In PMS, the client and the portfolio manager chart out specific needs of
the client and the manager manage the portfolio in accordance with those needs.
Sometimes the portfolio manager
may also have separate ready schemes for the client to choose from. As a result
of this customization, client, with his specific needs, benefits. The service level
in the form of reporting transactions, holdings statements etc., also are comparable
or even better than that of a mutual fund.
In short, a Portfolio manager manages client's wealth more efficiently; reduce risk
by diversifying across assets, sectors and funds, and improvise on returns. Expert
Portfolio Manager's endeavor is to find best of avenues to achieve optimum returns
at managed levels of risk.
This service could also be called as "transparent collective investments" where
you get an upper hand in more ways than one.
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