Alternate space – Size of the opportunity in India

  • Home
  • Blogs
  • Alternate space – Size of the opportunity in India
AIF & PMS Chatbot

Hello there!

Welcome to AIF & PMS Experts India Pvt. Ltd.

What is Portfolio Management Service?

Portfolio management services (PMS) is an investment Vehicle, which has been made keeping in mind high net worth individuals (HNI) who have higher risk appetite.

PMS is meant for what kind of investors?

It is the art and science of making decisions about investment, Portfolio Management Services (PMS) is a specialized & customized service that offers a range of specialized investment strategies to capitalize on the opportunities in the market. Though PMS is managed by professional portfolio managers, it has the potential to address the personal preferences tailored into the investment portfolio giving the freedom and flexibility required for achieving the financial goals. This is typically a high-end product meant for high net-worth individuals (HNIs) because it needs a minimum investment of 50 lacs.
If you look India as economy, we took about almost 60 years to become 1Tn $ economy post the independence, and thereafter hardly 8 years to double to size, we embark the journey towards 5T$ in size, especially in an environment where there is paradigm shift from import to ‘Make in India’ our Govt of India has been emphasis more on ‘ATMANIRBHAR BHARAT’, and therefore, Going ahead, we are going to rise in the in the HNI population in India.

How has the performance of the PMS’s been in India?

Well if you look at the last 18 years, there are many portfolio Managers who have delivered almost 17-18% CAGR Returns which means someone who invested 1 crs in 2003 is valued at  20 crs today, this has grown over a period of last 17 years.

Why Portfolio Management Services?

Today, the financial market is increasingly complex, and managing your own portfolio will take up a lot of your time and effort. There are situations when you don’t have time or knowledge to explore the best investment alternatives in the market. This is a common problem faced by many wannabe investors like you.

At this juncture, portfolio management services can help you get out of this dilemma. So you can simply assign your investments to portfolio management services who will report to you regularly on your portfolio performance. Don’t feel lost in this complex world of investments. Let the experts do their job.

How do you calculate the returns?

Earlier, these managers either use to refer their model portfolio for calculating returns however in the recent past, our regulator, SEBI has recently released a regulation whereby returns will have to be reported for each scheme on TWRR basis by experienced portfolio managers.

What are the charges? Is that expensive?

Portfolio manager’s offer varied fee structures to their clients, as a combination of fixed and variable rates. It’s on the client to decide which option he/she wants to opt for.

As such, there is no uniform regulatory fee structure in PMS. If compare this with other investment vehicles, I would say that it is at par with AIF & Mutual Fund industry.

Unlike mutual funds, PMS is less transparent as there are no investment objectives, past performance and fund strategies. Then how would one know which PMS to choose from?

Thanks to the regulator, gone are those days when it used to be very complicated. Now if you look at there are many large portfolio managers who have gone digital and provide all sort of report to look at the every details of the portfolio including cost etc. its mandettoory requirement from regullator’s side as well

What has been the growth of PMS in the last five years?

If you look at the PMS Industry as whole, the underlying Asset under management witnessed a healthy growth rate of 30% between FY2012 to FY2020. Today there are more than 50 portfolio managers in India with more than 100 PMS schemes.

What has been the growth of the alternate industry?

If you look at the total market cap of the entire globe (equity), it’s stands at 70T$ out of which the total AUM of alternate space in the world is about 11T$ which comes to almost 15% where in India this journey has just begun during the last decade where the industry witnessed alternate space reaching to 50Billion$, this is not even 5% of our total equity market cap which stands at 2T$.

As the investor community in emerging markets like India gets more informed and matured, they would certainly look out for tailor made portfolio managers who can design and build their portfolio as per their risk appetite and financial needs.

For more details please write back at [email protected]

Also Read – Top 5 Reasons You Should Invest in PMS

Also Read – Benefits Of Investing In AIF And PMS


Vikas Agrawal,

Managing Director & CEO at AIF & PMS Advisors India Pvt Ltd