As an investor seeking to maximize returns and diversify their portfolio, exploring various investment avenues is essential. Among these investing tools, PMS funds stand out as a viable option for investors looking for professional management. There are professional fund managers, they can customize their investing strategies by analysing PMS performance for maximum return.
This blog will delve into the reasons why investors should allocate their funds into large-cap, mid-cap, and small-cap PMS funds.
Understanding PMS funds – A brief introduction:
Before diving into the reasons to invest, it’s crucial to understand what PMS funds are. PMS funds are investment vehicles that allow investors to avail the expertise of professional portfolio managers.
These managers create a well-diversified portfolio tailored to meet the specific investment objectives of each client. PMS funds come in various categories based on the market capitalization of the companies they invest in. These could be three primary categories – large-cap, mid-cap, and small-cap PMS funds.
Why should you diversify your investments across various PMS cap sectors?
By investing in a combination of large-cap, mid-cap, and small-cap PMS funds, investors achieve optimal portfolio diversification. Each cap segment responds differently to market conditions, reducing overall portfolio risk.
The appeal of large-cap PMS funds:
Stability with security: Large-cap companies are typically well-established and have a proven track record. Investing in large-cap PMS funds offers stability and security due to their ability to withstand market fluctuations better.
Lower volatility: Large-cap stocks tend to experience less volatility compared to their smaller counterparts. This can provide a smoother investment journey for risk-averse investors.
Dividend income: Many large-cap companies offer regular dividends, providing a potential source of passive income for investors.
The potential of mid-cap PMS funds:
Growth potential: Mid-cap companies often possess high-growth potential as they are in the early stages of expansion. Investing in mid-cap Portfolio Management Services funds allows investors to capitalize on the growth opportunities offered by these companies.
Market capitalization transition: Mid-cap companies have the potential to evolve into large-cap companies. Hence, it leads to substantial capital appreciation for early investors in mid-cap PMS funds.
Diversification: Including mid-cap PMS funds in a portfolio enhances diversification. So, it reduces the risk associated with concentrated investments.
The prospects of small-cap PMS funds:
High-growth opportunities: Small-cap companies are at their nascent stages and have the potential for significant growth. Investing in good small-cap PMS funds allows investors to tap into this growth potential.
Undervalued gems: Small-cap stocks are often undervalued or overlooked by the market. Therefore, these stocks present possibilities for astute investors to discover hidden gems.
Niche market dominance: Such small-cap companies may be leaders in niche markets, offering unique products or services that give them a competitive advantage.
What are the reasons for PMS fund diversification?
For ease of understanding, we are going to break this section into smaller parts. Therefore, investors and experts can analyse the PMS performance for the month of July 2023.
Customization and personalized strategies:
- Tailored investment approach – PMS funds offer personalized investment strategies based on the investor’s risk tolerance, financial goals, and investment horizon.
- Direct ownership of securities – Investors in PMS funds directly own the underlying securities, allowing transparency and flexibility in managing their portfolios.
Active management & expertise:
- Professional portfolio management – PMS funds are managed by experienced professionals who constantly analyse market trends and company fundamentals to make informed investment decisions.
- Flexibility to capitalize on market opportunities – Portfolio managers in PMS funds can make swift adjustments to the portfolio to seize potential opportunities or mitigate risks.
Potentially higher returns:
- Alpha generation – Skilled portfolio managers in PMS funds aim to generate alpha, which refers to returns that surpass the benchmark index.
- Aggressive growth potential – Small and mid-cap PMS funds, in particular, may outperform large-cap funds during bullish market phases, potentially leading to higher returns.
Long-term growth opportunities:
- Capital appreciation – PMS funds, especially mid and small-cap segments, offer excellent prospects for long-term capital appreciation.
- Long-term investment horizon – Investors who have a longer investment horizon in a Portfolio Management Services can benefit from the compounding effect over time.
Risk management and drawdown protection:
- Risk mitigation – Diversification across large, mid, and small-cap PMS funds helps in reducing the overall risk in the investment portfolio.
- Drawdown protection – Active management in PMS funds enables managers to implement risk management strategies. Therefore, they potentially minimize drawdowns during market downturns.
Now you may wonder in which PMS funds you should invest. You may know the comparative performance in a specific time frame is one of the best indicators to choose a suitable fun to invest.
The top funds in PMS performance report in July 2023:
Below, we share three PMS fund performance tables regarding this. The table shows the fund performance based on their one year of performance.
The 3 Best Performing Large Cap PMS in July 2023
| AMC & Fund Names | Inception Date | Strategy Performance |
| LIC MF Value Equity + PMS | May-13 | 32.29% |
| Care PMS Large & Midcap Strategy | Jul-20 | 31.60% |
| ICICI Prudential PMS Largecap Strategy | Mar-09 | 31.60% |
The 3 Best Performing Mid-Cap PMS in July 2023
| AMC & Fund Names | Inception Date | Strategy Performance |
| AAA Budding Beasts | Jan-21 | 42.44% |
| ACE Midcap | Dec-17 | 36.61% |
| Right Horizons -Super-Value Fund | Nov-12 | 32.25% |
The 3 Best Performing Small Cap PMS in July 2023
| AMC & Fund Names | Inception Date | Strategy Performance |
| ICICI Prudential PMS PIPE Strategy | Sep-19 | 45.70% |
| Ambit – Emerging Giants | Dec-17 | 40.50% |
| Green Lantern Capital Growth Fund | Dec-17 | 45.45% |
Make an informed decision:
Investing in large, mid, and small-cap PMS funds provides a plethora of advantages, ranging from stability to high-growth potential. By considering these top reasons, investors can make an informed decision based on their risk appetite, investment goals, and time horizon. Enthusiast investors also look at the above PMS performance table for a better understanding.
If you want to take investing-related decisions for your better ROI, visit AIF & PMS Experts. We shall assist you to take decisions to align your portfolio with your unique financial objectives. You may like to call us at 8368586435, and you may also contact through [email protected].