Portfolio Management Services (PMS): Benefits & Is it Right for You?

Today, we all know that to succeed in investing, we must regularly check and adjust our investments.

There are two ways people manage their portfolios: either by themselves or through professional help.

Many investors choose Do-it-yourself (DIY) & prefer researching and picking individual stocks to build their portfolios.

Some people like to choose stocks and manage their portfolios by themselves, but smart investors, recognizing the complexity of the markets, prefer to seek help from a professional.

Portfolio Management Services (PMS) is a service where financial advisors manage your investments to help you achieve your financial goals.

This is where Portfolio Management Services (PMS) come in.

Benefits of Portfolio Management Services:

Governed by Regulations:

Regulations tightly monitor PMS & fund managers. Portfolio managers periodically submit reports to the government about transaction statements, holdings, etc.

Fund managers must maintain transparency with the investors regarding the holding statements, performance, fees, etc. Thus, PMS provides complete transparency to its investors and facilitates informed decision-making.

PMS offers transparency to its investors, so they can make informed choices about their investments.

Realtime Access:

Now in this modern age, online portals are offered by most investment managers for easy account access. You can check your investment portfolio details (such as values, holdings, expenses, etc) anytime and anywhere.

Investors can also access research reports and related information for a better understanding of investments. Now, online demat accounts and portfolio management includes new features (such as redemption, trading, and adding capital).

Some PMS Providers use AI (Artificial Intelligence) or Robotics to build financial plans that align with the investor`s financial goal.

Portfolio Rebalancing:

Portfolio Rebalancing is a very important benefit of PMS for investors.

PMS uses an aggressive investment strategy and offers dynamic portfolio rebalancing services.

Based on market volatility, fund managers adjust the allocation into different assets. Maintaining a high-quality portfolio remains the priority, considering both short-term and long-term gains.

Relationship Manager:

Portfolio Management Services (PMS) enhance your investment experience by providing a dedicated account manager. A dedicated Relationship Manager or Account Manager who is available to assist with common questions and concerns.

Premium Portfolio:

Those who manage investments place less focus on quality and more on price than value. Individual investors (Non-Promoter/Non-Institutional Investors (NPNI)) don`t hold shares in major indices like Nifty, BSE 200 or even Nifty 500 despite thousands of listed companies.

Small businesses not included in the index have higher retail or NPNI holdings. Their portfolios are skewed toward low-quality stocks.

Nifty accounts for about 60% of the market capitalization, BSE200 accounts for almost 85% of the market capitalization and Nifty 500 accounts for almost 94% of the market capitalization.

Transparent and Strong Holdings:

PMS is transparent. So, using cricket terminology, a PMS investor can get his ball-by-ball report of the portfolio. Each trade is communicated to the investor and the manager`s website provides his view of the portfolio in real time.

Customers can see the target portfolio of selected stocks from among the holdings of the portfolio. Mutual funds often have large, diversified portfolios of 25, 30, or even 100 stocks (with limited transparency), and only disclose their holdings monthly or quarterly.

An investor who has in his portfolio 5/6/7 different funds will end up containing around 250-300 stocks in his portfolio. Even if you duplicate your holdings through research, you`ll still find yourself owning virtually everything in the market, resulting in diluted returns.

Customers are Focussed:

PMS helps you focus on the masses and high-net-worth customers.

While mutual funds can use SIP and other techniques to target new markets and smaller groups, PMS stands out in its focus on high-net-worth individuals.

This sector of the Indian market is growing rapidly, values ??flexibility and most importantly is comfortable with equity investments. The number of people investing in stocks is more than three times that of those investing in mutual funds.

Either way, equity has been a significant source of wealth growth over the past decade. Investing in PMS allows you to easily diversify your assets.

Who Should Opt for PMS?

• - Since you`re new to investing, you prefer someone to manage your investments.
• - You don`t have the time to manage your investments day-to-day.
• - You are concerned about market volatility and don`t know how to keep your investments safe.
• - You want to diversify your investment in different investment options.

Step To Choose the Right PMS (Portfolio Management Service):

1. Analyze:

Before diving into a PMS, understand the health of your investment by conducting a simple financial self-assessment.

This will help you strategize. Consider your goals (retirement, education, etc.), risk tolerance, investment horizon (short-term or long-term), and current holdings.

This analysis creates a clear view of your investments and allows your PMS to create a personalised plan tailored to your needs and goals.

2. Existing Situation:

Screening Diagnostic Recommendations: Portfolio`s Health Builds Wealth. Our role as your investment and financial advisor is to save and build wealth for you. We use internal processes to analyse your portfolio and provide recommendations to help you make better investment decisions.

3. Compare All Major PMS providers:

It is important to compare Major PMS providers such as Narnolia, ICICI PMS, & Purnartha PMS. If you choose any PMS service you should Consider their investment approach (such as asset allocation, risk management, Investment style), past performance, and fees to pick the one that fits your risk tolerance and goals.

4. Ask Your Investment Advisor:

Choosing a PMS can be complex. If you think it`s very difficult for you to choose the Best PMS service that aligns with your financial goals & risk tolerance. You should Ask Your Investment Advisor who can assess your current situation and give you suitable advice & you can ask any other concern you may have.

To know more about PMS Contact us today by calling 02692-225000.

Conclusion:

PMS is a personalised way to achieve your financial goals. It`s very suitable for individuals who have a high net worth and high risk tolerance.

Aligning your financial goals with your investments can result in greater returns over time.

Feel free to contact us if you’d like to know more about PMS!