PMS
Portfolio Management Services (PMS) is a specialized service that offers a range of specialized investment strategies to capitalize on the opportunities in the market.
Investing requires knowledge, time, and the right mind-set. This is besides constant monitoring. PMS gives you professional managers who strategize to deliver you consistent returns keeping your risk appetite in mind. Every portfolio manager has a well-defined investment philosophy and strategy that acts as a guiding principle.
PMS relieves investor from all the administrative hassles of investments. You receive periodic reports on your portfolio performance and other aspects of your investments. Investments are tracked continuously to maximize returns.
In a PMS setup, your relationship manager defines your financial goals and advises you the right product mix. They give personalized service and ensure that you receive periodic updates and account performance reports.
PMS: Basics
What is the fee structure for PMS?
The fee structure depends from company to company. There may be many options such as:
- A fixed proportion of the fund amount (for eg. 2% of the initial corpus)
- A fixed proportion of the fund amount + variable depending upon the performance of the portfolio (2% above 10% of the returns)
- Variable depending upon the performance of the portfolio
What are the tax implications of investments in PMS?
At present, 10% tax is chargeable for short-term capital gains and no tax is chargeable on long-term capital gains. Securities transaction tax (STT) is also applicable.
Each PMS transaction is considered an independent trade and capital gains will be applied on each depending upon whether the relevant stock was held long-term or short-term. At present, 10% tax is chargeable for short-term capital gains and no tax is chargeable on long-term capital gains. Securities transaction tax (STT) is also applicable.