PMS / AIF
What Is PMS / AIF?
Portfolio Management Services (PMS) is a customized and professionally managed investment vehicle that uses different investment strategies to take advantage of market linked opportunities.
PMS is ideal for high-net worth individuals (HNI’s) who are willing to take on risk and gain market exposure, by investing directly into a basket of securities such as equities, fixed income, structured products, etc.
Finance company is empanelled with a wide range of reputed third-party PMS providers across India, such as AMC’s and financial institutions which provide their specialized PMS offerings.
Alternate Investment Funds
Alternate Investment Funds (AIF’s) usually include real estate, private equity, hedge funds and venture capital funds or investments in stocks and bonds using strategies that go beyond traditional ways of investing, such as long/short or arbitrage strategies. Because alternatives tend to behave differently than typical stock and bond investments, adding them to a portfolio may provide broader diversification, reduce risk, and enhance returns. DhruvNivesh is empanelled with exceptional third-party AIF providers so that investors can diversify their portfolio and benefit from their high-return opportunities in the long- run.
AIF vs PMS: Let us Understand the Difference
Regulatory Framework:
- PMS: Portfolio Management Services are regulated by the Securities and Exchange Board of India (SEBI) under the SEBI (Portfolio Managers) Regulations, 2020.
- AIFs: Alternative Investment Funds are also regulated by SEBI under the SEBI (Alternative Investment Funds) Regulations, 2012.
Investment Approach:
- PMS: Portfolio managers typically offer discretionary or non-discretionary services where they manage portfolios of securities on behalf of clients based on the client’s investment objectives and risk tolerance.
- AIFs: Alternative Investment Funds invest in a variety of asset classes such as private equity, real estate, hedge funds, distressed assets, and structured products. They may employ different strategies including long-only, long-short, and event-driven strategies.
Investor Base:
- PMS: Portfolio Management Services are typically offered to High Net Worth Individuals (HNIs) and institutional investors who have a minimum investable corpus as prescribed by SEBI.
- AIFs: Alternative Investment Funds target sophisticated investors including HNIs, institutional investors, family offices, and qualified institutional buyers (QIBs).
Minimum Investment Requirements:
- PMS: Minimum Investment Required INR 50 Lakhs
- AIFs: Minimum Investment Required INR 1 Crore
Liquidity:
- PMS: Low to moderate liquidity depending on the stocks held.
- AIFs: Very low liquidity due to lock-in periods and exit loads.
Fee Structure:
- PMS: Portfolio Management Services typically charge a management fee and performance fee based on the assets under management (AUM) and the performance of the portfolio.
- AIFs: Alternative Investment Funds may have different fee structures depending on the category and strategy of the fund, including management fees, performance fees, and other expenses.
Overall, while both PMS and AIFs offer professional management of funds, they cater to different investor segments and have distinct investment approaches, regulatory frameworks, and fee structures. Investors should carefully evaluate their investment objectives, risk appetite, and preferences before choosing between PMS and AIFs.
Analyze Your
Business.
Transforming distribution and marketing with key capabilities in customer insight and analytics.
A Team
Of Professionals.
Transforming distribution and marketing with key capabilities in customer insight and analytics.