Portfolio Management Services (PMS)

Portfolio Management Services (PMS) is a professional investment management service offered by SEBI-registered Portfolio Managers to high-net-worth investors — where the portfolio manager invests the client's funds in a customised portfolio of stocks, bonds, or other securities based on the client's investment objectives, risk profile, and financial goals. Unlike mutual funds (which pool money from all investors into a common portfolio), PMS accounts are individually managed — each client has a separate Demat account and a personalised portfolio that may differ from other clients based on the timing of investment and individual customisation. SEBI mandates a minimum investment of ₹50 lakh per client for PMS. PMS offers are classified as Discretionary (portfolio manager makes all investment decisions independently), Non-Discretionary (manager executes trades as per client instructions), and Advisory (manager provides recommendations, client decides). PMS managers charge a fixed management fee (typically 1% to 2% per annum) and often a performance fee (10% to 20% of profits above the hurdle rate). For sophisticated Indian investors who have outgrown mutual funds — either due to the size of their portfolio, desire for customisation, or specific investment mandates not available in standard fund categories — PMS provides the flexibility of tailored portfolio construction with the professional expertise of SEBI-registered managers and complete transparency of individual security holdings.