How portfolio management works in India is a common question among High-Net-Worth Individuals (HNIs), family offices, and serious investors. These individuals are not only looking for higher returns but also demand personalized, professionally managed portfolios. Unlike mutual funds, Portfolio Management Services (PMS) offer bespoke strategies, direct asset ownership, and hands-on management.
Moreover, PMS in India is regulated by SEBI, ensuring high standards of governance, performance transparency, and investor protection.
1. Client Onboarding & Financial Goal Mapping
The PMS journey starts with an in-depth onboarding process. At this stage:
- The PMS provider evaluates your financial goals, risk appetite, and investment horizon.
- In addition, your liquidity needs and return expectations are documented in an Investment Policy Statement (IPS).
This step is crucial because it ensures that the portfolio is not only tailored to your needs but also built on a strong strategic foundation.
2. Customized Portfolio Construction
Once your goals are established, the portfolio manager builds a customized asset mix. Typically, this includes:
- Equities
- Fixed-income instruments
- Alternative assets
Unlike mutual funds, which follow a one-size-fits-all approach, PMS portfolios are personalized. For instance, active PMS allows for tactical changes based on market conditions, whereas passive or discretionary PMS follows a more stable strategy.
3. Execution & Asset Allocation
After finalizing the investment plan, the PMS provider initiates the execution phase:
- Securities are purchased in your demat account, ensuring direct ownership.
- With Discretionary PMS, the portfolio manager makes investment decisions without prior approvals.
- Conversely, in Non-Discretionary PMS, every transaction must be approved by the client.
As a result, you retain control if desired or can delegate fully depending on your preference.
4. Ongoing Monitoring & Rebalancing
Portfolios are not set-and-forget. Instead, they are actively monitored to ensure alignment with your financial objectives:
- When market conditions change or portfolio performance deviates from expectations, rebalancing is conducted.
- Additionally, investors receive monthly or quarterly performance reports, maintaining transparency and trust.
5. Fee Structure & Transparency
It’s important to note that PMS usually has a higher fee structure than mutual funds:
- Annual management fees range from 2%–2.5%.
- Furthermore, some PMS providers charge performance-linked fees, where managers earn more only when they deliver above-benchmark returns.
This fee model, therefore, aligns the interests of the manager with that of the investor. However, PMS does not guarantee returns—SEBI regulations ensure managers maintain transparency and act in the client’s best interest.
Key Benefits of Portfolio Management Services in India
Personalization & Flexibility
Each portfolio is uniquely tailored and frequently reviewed to match your evolving goals.
Professional Expertise
Since portfolios are managed by seasoned professionals, you benefit from data-driven decision-making and market insights.
Direct Ownership
Unlike mutual funds, PMS offers you direct ownership of each asset, improving visibility and control.
Diversification
PMS spreads your investments across asset classes and sectors, thereby lowering overall risk.
Risk Management
Because portfolios are actively rebalanced, risk exposure is carefully managed over time.
Regulation & Trust
PMS providers must comply with SEBI’s strict regulatory standards, adding a layer of protection and trust.
Who Should Consider PMS in India?
PMS is ideal for investors who:
- Have ₹50 lakh or more in investable assets
- Require custom-built portfolios beyond mutual funds
- Prefer hands-on, professional management
- Value transparency, direct control, and risk governance
On the other hand, investors with smaller capital or those seeking low-cost options may find mutual funds more suitable.
Summary: Why PMS Is a Strong Investment Tool in India
To summarize, if you’re wondering how portfolio management works in India, here are the key takeaways:
- Strategic Alignment: The process starts with your goals, not generic market assumptions.
- Tailored Portfolios: Portfolios are crafted around your risk and return preferences.
- Expert Oversight: Professional managers monitor and adjust your investments as needed.
- Full Transparency: You receive regular updates and hold each asset in your name.
- Regulatory Safeguards: PMS is governed by SEBI, ensuring professionalism and ethics.
Ultimately, Portfolio Management Services combine strategy, transparency, and expertise—making them ideal for those who seek personalized wealth growth in India’s evolving financial ecosystem.
Ready to Take Control of Your Wealth?
Contact AS Portfolio Management Services to build a portfolio that’s designed just for you—with clarity, control, and confidence.
