Portfolio Management Service
Printed From: The Equity Desk
Category: Personal Finance & Lifestyle-Strategies & problems
Forum Name: Personal Finance - Startegies
Forum Discription: Discuss startegies for tax planning, insurance coverage, Retirement planning, Home loans car purchases or any thing that affects personal finance.
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=1005
Printed Date: 19/Apr/2025 at 7:22pm
Topic: Portfolio Management Service
Posted By: absolut
Subject: Portfolio Management Service
Date Posted: 20/Jun/2007 at 4:05pm
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from computers to pizzas everything is getting personalised . So why the equity markets be behind ? this personalised service in the markets would probably be PMS ( Portfolio Management Service ) . It is usually a more concentrated porfolio of stocks than the MFs . The over all corpus size is also lesser ...which probably gives it more flexibility and more over a PMS fund manager is not hand tied like the MF fund manager by SEBI .... but the only problem with PMS is that it has a high ticket size ... but as far as returns are concerned their a better than MFs .... more over after redeeming the PMS you can choose to hold the stocks ... so its like owning them ....any body with real time PMS expeience ..any comments ????
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Replies:
Posted By: basant
Date Posted: 20/Jun/2007 at 4:10pm
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The cut that the manager takes is too high. They take 25% of profits after a hurdle rate of 8%. ------------- 'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in |
Posted By: smartcat
Date Posted: 20/Jun/2007 at 4:48pm
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Investing in PMS gives the investors a big ego boost. The idea is - Wow! Kotak thinks I'm so important that they want to manage my money. It is much 'cooler' to say - 'HSBC is managing my money' than to say 'I'm investing in HSBC Mutual Fund'.
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Posted By: absolut
Date Posted: 20/Jun/2007 at 6:02pm
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And I think that is totally fair . Remember the Maslow`s hierarchy , people at the `` self esteem `` category would like to have such services . A recent look at the numbers of HNIs in India will exactly give why PMS is sucessful and worth it . Here the investor gets directly to interact with the fund manager which is better than talking to a dealer . Lot of people now have the money , the authority and the need ( MAN ) but no time or perhaps modicum of expertise . So why not get an expert on the table . It might be a bit costly but then it is not meant for all . an anlogy probably would be although Maruti is the market leader why do you think Audi, Merc , Rolls Royce are foraying into India . And these are perfect triggers for a growing economy .
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Posted By: kulman
Date Posted: 20/Jun/2007 at 12:59pm
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New TEDies may wish to see why PMS mostly means "Pyaar-se Maaro Scheme" by http://www.theequitydesk.com/forum/forum_posts.asp?TID=359&PN=9 - clicking here.
http://www.theequitydesk.com/forum/forum_posts.asp?TID=359&PN=9 -
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: Shankru
Date Posted: 04/Aug/2007 at 10:10pm
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I have invested in Kotak PMS in October 2006. The scheme has given me a post tax return of 2% as on 31st March. I am hoping they will turn around fast. It is very difficult to understand their stock selection process and the relationship manager simply forgets you after the cheque is collected! They don't bother to get in touch with the client and explain why the fund is under-performing. ------------- I know it's all Maaya |
Posted By: kulman
Date Posted: 04/Aug/2007 at 10:28pm
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Shankru
Ohhh....so sorry to hear that. Maybe they already knew about your tagline!
On a serious note, I know many people who have similar experience even with other PMSs. They must have charged you management fee upfront and churned & turned the scrips in your portfolio many times over to generate brokerage! (the fund manager must have been promoted for his skills)
I may sound a bit harsh to the people who are employed in this industry, but fact is that PMS clients are dissatisfied. I don't wish to put names on this forum but there are examples involving lots of big brokerages.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: kulman
Date Posted: 10/Aug/2007 at 12:16pm
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"In 2006, promises and fees hit new highs. A flood of money went from institutional investors to the 2-and-20 crowd. For those innocent of this arrangement, let me explain: It’s a lopsided system whereby 2% of your principal is paid each year to the manager even if he accomplishes nothing – or, for that matter, loses you a bundle – and, additionally, 20% of your profit is paid to him if he succeeds, even if his success is due simply to a rising tide. For example, a manager who achieves a gross return of 10% in a year will keep 3.6 percentage points – two points off the top plus 20% of the residual 8 points – leaving only 6.4 percentage points for his investors. On a $3 billion fund, this 6.4% net “performance” will deliver the manager a cool $108 million. He will receive this bonanza even though an index fund might have returned 15% to investors in the same period and charged them only a token fee."---Warren Buffet
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: basant
Date Posted: 10/Aug/2007 at 11:58am
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let us look at it from the fund manager's perspective. Could not have been anything better then this. Stocks like PRIL, Kotak bank, R-Cap are all means to making money in this "dirty" arrangement.l ------------- 'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in |
Posted By: deepinsight
Date Posted: 11/Aug/2007 at 2:51pm
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In an ideal world - how should a PMS manager charge? (earn his or her money? - i.e. if they can make money with integrity for their investors) Did W. Buffett and Mohnish Prabai not set up similar structures (except they seem to be delivering) ------------- "Investing is simple, but not easy." - Warren Buffet |
Posted By: leo2007
Date Posted: 11/Aug/2007 at 3:26pm
| When they buy and sell shares,do they charge brockerage? . What happens to the dividend they receive ? |
Posted By: kulman
Date Posted: 11/Aug/2007 at 3:37pm
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Yes, that's the point. When they churn their portfolio just for generating brokerage it doesn't help the poor investors. There could be some genuine ones also.
One gulf-based NRI person told me that a brokerage is pushing a Momentum based scheme (min investment US$25K, Rs.10Lakhs) and they have indicated returns of Rs.50,000 per month. My personal view is to avoid such things.
------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: Buffet
Date Posted: 05/Nov/2007 at 12:16pm
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A little bit off topic...
Are you guys aware of any softare or website which allows us to manage out stock portfolio in a comprehensive manner. I have tried out both ICICDirect and Rediff. Both are incomplete, Icici provides only a "current snapshot" and rediff provides a combined porfolio performance chart for 5 days only. I would like to have an online chart which tracks and records the stock prices on a daily basis and where I can retrieve the performance data and charts of one or more stocks for any date range. please let me know if you have come across anything like that. |
Posted By: kulman
Date Posted: 29/Jul/2008 at 9:36am
Another reason why the PMS mostly means "Pyaar-se Maaro Scheme" (Read more by forum_posts.asp?TID=359&PN=9 - clicking here. ) ------------- Life can only be understood backwards—but it must be lived forwards |
Posted By: absolut
Date Posted: 13/Nov/2008 at 11:59am
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During all these mayhem ... has any body spared a thought about what our esteemed fund managers upto ? Some of my friends say their PMS are tracking the markets by a factor of -15% ... any views from anybody ???
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Posted By: kulman
Date Posted: 18/Feb/2009 at 7:39pm
WARNING: Be careful जहाँ तेरी ये नजर हैं मेरी जाँ मुझे ख़बर हें बच ना सका कोई .......आए कितने ------------- Life can only be understood backwards—but it must be lived forwards |
