Portfolio Management Services in India

PMS is a professional, personalised investment service where a SEBI-registered portfolio manager builds and manages a portfolio of securities on your behalf. Unlike pooled vehicles, the securities are held directly in your own demat account, giving you transparency and direct ownership of each holding.

In a mutual fund your money is pooled with thousands of investors and you own units of the scheme. In PMS you own the underlying securities directly in your demat account, portfolios are more concentrated and can be tailored, and the minimum investment is far higher — ₹50 lakhs versus a few hundred rupees for a mutual fund.

In PMS securities are held in the investor's own demat account and the portfolio is managed individually. In an AIF, capital is pooled with other investors into a single fund and investors hold units of the fund. PMS has a ₹50 lakh minimum versus ₹1 crore for AIF, and AIFs can access instruments such as unlisted equity or derivatives that a typical PMS does not.

SEBI mandates a minimum investment of ₹50 lakhs per investor for PMS. This can be contributed as cash or, in some cases, as an existing portfolio of securities valued at the applicable amount.

PMS suits high-net-worth individuals, family offices, and corporates who can commit the ₹50 lakh minimum, want a concentrated and actively managed equity portfolio, and are comfortable with market-linked risk and a longer investment horizon.

There are three types. Discretionary PMS, where the manager makes all investment decisions; non-discretionary PMS, where the manager advises but you approve each decision; and advisory PMS, where the manager only provides recommendations and you execute. Most retail PMS offerings in India are discretionary.

Securities are held in a demat account opened in the investor's own name, and cash is held in a designated bank account. The portfolio manager operates these accounts under a power of attorney limited to executing the agreed strategy, so you retain direct ownership of every holding.

No. PMS returns are market-linked and depend on the strategy, stock selection, and market conditions. Returns are neither assured nor guaranteed, and past performance does not indicate future results.

PMS carries market risk, concentration risk (portfolios are often focused on a limited number of stocks), manager risk, and liquidity risk. Because portfolios are concentrated and equity-oriented, returns can be more volatile than diversified mutual funds over short periods.

CAGR is the compounded annual growth rate over the stated period and helps compare strategies on a like-for-like basis. It reflects past performance only, is typically shown before or after fees depending on the disclosure, and should be read alongside the strategy's risk, benchmark, and track-record length rather than in isolation.

In discretionary PMS the manager follows a defined model portfolio, so customisation is limited, though some managers allow restrictions such as excluding specific sectors or stocks. Non-discretionary and advisory mandates offer more say over individual decisions.

PMS typically charges a fixed management fee on assets, and many offer a performance-fee option linked to returns above a hurdle rate. Additional costs may include brokerage, custody, audit, and exit charges. Fee structures are disclosed in the PMS agreement and disclosure document, and you can usually choose between fixed-fee and performance-fee plans.

Because you own the securities directly, capital gains are taxed in your own hands based on the holding period of each security — short-term or long-term as applicable — much like a direct equity portfolio. Dividends are taxed at your slab rate. Since every buy and sell is a taxable event in your name, PMS can generate more tax events than a fund; consult a tax advisor for your situation.

PMS providers give access to portfolio holdings, transactions, and performance, and SEBI requires periodic reporting to investors, commonly on a monthly or quarterly basis, along with audited statements. Many managers also provide online portals and periodic commentary.

PMS generally has no regulatory lock-in, so you can withdraw subject to the terms of your agreement. However, some strategies apply an exit load if you redeem within a defined initial period, and redemptions are settled by selling securities, which may take a few business days.

Common documents include PAN, identity and address proof, a cancelled cheque and bank details, demat account details or authorisation to open one, KYC records, FATCA and CRS declarations, a risk profile, and the signed PMS agreement with power of attorney. NRIs and corporates may need additional documents specific to their structure.

Yes, NRIs can invest in PMS subject to FEMA regulations and the provider's eligibility criteria. Investment is typically routed through NRE or NRO accounts and a PIS or non-PIS route depending on the fund flow, and repatriation depends on the source of funds and account type used.

The PMS agreement is the contract between you and the portfolio manager, setting out the strategy, fees, power of attorney, and terms. The disclosure document, mandated by SEBI, details the manager's background, strategies, risk factors, fees, past performance, and conflicts of interest, and should be reviewed carefully before signing.

Wealth North can help you review available PMS strategies, compare disclosure documents and fee structures across providers, understand minimums and suitability against your goals, and walk through the onboarding and documentation process before you invest.