Portfolio management has become an increasingly popular investment option for investors in India. With the growth in financial markets and investment products, investors are looking for professional help to manage their portfolio. Portfolio management services cater to this need by providing customized investment solutions based on an investor’s goals, risk appetite and investment horizon. Choosing the right portfolio management service is crucial to generate good returns. One of the key factors to consider is the minimum investment amount required. This article provides an overview of portfolio management services in India, the typical minimum investments required and expected returns.
SEBI Regulations on Minimum Investment in PMS
Securities and Exchange Board of India (SEBI) has set the minimum investment amount for PMS at Rs.50 lakh. This limit was set to restrict small investors who may not have the sophistication to understand complex investment products. However, some PMS providers have obtained SEBI approval to lower the minimum investment limit to Rs.25 lakhs for certain categories of investors.
Typical Minimum Investment Required by Leading PMS Providers
While SEBI mandates a minimum of Rs.50 lakhs, most leading PMS providers require higher minimum investments. For equity PMS, minimum investments range from Rs.50 lakhs to Rs.10 crores. Some PMS specializing in alternate assets may require even higher minimum investments of Rs.15-25 crores.
The minimum investment required for portfolio management services in India is dictated by SEBI regulations and actual requirements of PMS providers. While the SEBI minimum is Rs.50 lakhs, most reputed PMS require higher minimum investments in the range of Rs.50 lakhs to Rs.10 crores based on the investment strategy. Investors should evaluate minimums along with expected returns while choosing a PMS provider.