What is PMS and Its Advantages

Many individuals who have plenty of wealth with them to invest in capital markets but them refrain from investing because of lack of financial knowledge needed to invest in markets, for such individuals PMS can be very valuable thing.

PMS is called portfolio management service which is a highly specialized service that is tailor made for the client. In this service a portfolio manager is assigned the task of managing the investments of the client. Portfolio manager will ask the client about his preference that is how much to invest, his risk tolerance, time horizon of investments and then formulate the investment strategy. For PMS one has to pay either a flat fee structure which is a fixed amount or it can be performance based depending on the return on investments generated by the manager, still PMS has the following advantages –

1. The client gets to utilize the services of a portfolio manager who is an expert in his field and hence chances of good returns on investments are enhanced.

2. Since portfolio manager make use of risk management tools, portfolio of the client is protected against volatile market movements, also client get the advantage of fundamental and technical research on markets s well as individual stocks done by the manager.

3. Portfolio management service is a cheaper option as compared to mutual fund in which there is entry load and also there is no client wise segregation like PMS.

Though PMS is provided to only those who are high net worth individuals (persons having large amount of money). Still it is an invaluable service for individuals who are not familiar with equity markets.

0 comments… add one

Leave a Comment


Related pages


systematic risk vs unsystematicadvantages and disadvantages of mixed economy pdftheory of absolute advantage by adam smithbill of exchange drawerdifference between substitute and complementary goodsadvantages of conglomerate integrationadvantages and disadvantages of perfect competitionmeaning of wholesaler and retailerglobalization disadvantagesexample of law of diminishing marginal utilitycibil in bankingelasticity of demand with examplesthe advantages and disadvantages of globalizationadvantages activity based costingmarket based pricing advantages and disadvantagestrial balance is preparedpricing strategies gcsedistinguish between trade discount and cash discountcompare socialism and capitalismadjusting entries for prepaid expensesfull form of rtgsunqualified audit opinion definitionmerits and demerits of line organisationrole of government in command economyadvantage and disadvantages of social mediawhat is slr crradvantages and disadvantages of communism economydisadvantages of acquisitionsreverse stock split advantagesfifo method of inventorymixed economy in nigeriaadvantages and disadvantages of investment appraisalfull form of gstdefine securitizedmerits of capitalismadvantages and disadvantages of housing financewhat are different types of chequesfull form fdiissued vs outstanding shareswhat is unearned revenueslimitation of barter systemsubstitutes in economics examplesdisadvantages of social media marketingadvantages of an autocratic leadership styledemat account benefitsdifference between account payable and account receivablepenetration marketing strategynormal good definition economicsconservatism conceptdifference between draft and chequedefinition subventionadvantages of jit productionexamples of current assets and liabilitiesstatutory liquidity ratio indiajournal entry deferred revenuemonopolistic competition advantages and disadvantagesfactors affecting elasticity of demandfluctuating exchange ratesinelastic products examplesautocratic companiesmixed economics definitionprepaid journal entriesexamples of products with elastic demandexample of vertical mergerrental income journal entrylimitations of absorption costingthe fifo methodfull form of neft & rtgswhat is a indirect quotationsteps on how to withdraw money from atmdual aspect concept of accounting with examplesnondurable goods definitionplanned economies examplesdupont analysis chartprepaid accounting entryadvantages and disadvantages mixed economynet worth calculation of companyadvantages of fifo methodmonopolistic competition companymeaning of consigner