Advantages Of Investing In Portfolio Management Services

By over-diversifying one’s portfolio with an increased variety of securities, investors often run in losses rather than generating higher-than-ideal returns. In other words, investment without comprehensive knowledge about the markets, current financial climate, or a proper strategy and objective can lead to lower returns than expected. 

In such a scenario, professional financial guidance always acts as a boon. In Portfolio Management Services, expert professionals offer an appropriate mix of investment options as per the financial goals and risk appetite of an investor. 

If you are looking for such an investment avenue and wondering how to connect with such experts, consider KredX as your investment platform. This online platform works with SEBI-registered fund managers and helps investors get customised professional financial services.     

However, before investing in any financial product, every investor must evaluate its primary benefits that make it an ideal investment instrument. The same goes for investing in PMS as well. 

What Are The Benefits Of Investing In Portfolio Management Services?

• Enhanced Portfolio 

While a significant amount is certainly favourable when it comes to investments, untrained or inadequate knowledge about the markets can end up compromising the quality of a portfolio. 

A glance at one of the top stock indexes like Nifty shows that individual investors possess a lower share of holdings and low-quality stocks as they emphasise price over value. Hence, it is imperative to have the expertise help, i.e. PMS, to build a quality portfolio.

• Maximum Returns 

Investment in Portfolio Management Services connects you with SEBI-registered analysts. These experts closely monitor an investor’s portfolio, indulge in rigorous market research, keep track of your profile, and only invest when the proper market condition strikes. As only an informed decision can guarantee a profitable result, PMS investment with the help of expert portfolio managers undoubtedly ensures superlative returns.     

• Separate Portfolio 

Unlike mutual funds, PMS investment is not governed or affected by the behaviour of hundreds and thousands of investors. Here, decisions – buying and selling and their timing – are executed at the investor’s discretion (depending on the type of PMS chosen). 

• Protected By Financial Risk Management Plan 

PMS investment comes with a robust financial risk management plan to reduce the risk and increase returns during bearish market situations. Such a plan keeps track of diversification, market and interest rates, inflation, and other essential factors.

• Tailor-Made Investment Portfolio 

Investment in PMS enables investors to achieve a customised portfolio. This investment vehicle allows individuals to decide or discuss with the fund manager the securities or stocks to choose or avoid, thus, ensuring the desired portfolio. 

• Transparent Fee Structure 

PMS investment comes with a transparent fee structure (legally agreed fee structure) and provides investors with a detailed list of charges/expenses related to a portfolio. Moreover, the expense ratio can be tailored based on the ticket size and a performance-based fee structure.

• Transparent Data Management

Investors can get hold of each detail regarding their portfolio, trading and view them from their home’s comfort. Hence, this investment offers the utmost transparency of portfolio information.

Now that investors have a clear picture of the numerous advantages of portfolio management services, they must know who and how they can invest in PMS. 

Who Can Invest In Portfolio Management Services?

Portfolio Management Services are designed to cater to a variety of investors, including:

• High net-worth individuals
• Non-individuals (HUFs, Partnerships Firms, Institutional Entities, Sole Proprietorship Firms, family businesses)

How To Invest In Portfolio Management Services?

To opt for PMS investment, investors must have a minimum capital of Rs. 50 lakhs (as per the new SEBI regulations).

With this amount, investors can invest in two ways described below:

Mode-1: Investors can invest their funds in a PMS account through a cheque. 

Mode-2: An investor can directly transfer the existing stocks to their PMS account. Please note, that the amount transferred to a PMS account must exceed the minimum investment threshold.     

Investors can do so by first selecting a portfolio manager. To that end, they can consider platforms like KredX, featuring an array of SEBI-registered PMS providers as well as bonds and digital gold. 

Bottom Line

PMS investment is an effective avenue to achieve a customised portfolio that helps generate ideal returns. As this investment option is highly guided and closely monitored by expert managers, investors can trust their money or stocks with professional financial advisors. Besides a diversified and tailored portfolio, investors can also enjoy benefits like transparency in fees and information management, high-end financial risk management plan, independent portfolio, and many others.