In this blog you will find out why high-net-worth individuals (HNIs) are choosing Portfolio Management Services (PMS) over traditional funds like mutual funds. We will differentiate what PMS is and how it is different from mutual funds, as well as the advantages of PMS and the types of PMS available in India, costs, risks, and why for ‘2025’ it has become the gold standard for personalized wealth management.
What is a Portfolio Management?
Portfolio management is both an art and a science – it involves creating an investment portfolio that satisfies an investors goals, objectives, time horizon, and risk appetite. Unlike casual picking their best assets, professional portfolio management as defined includes much more:
- Risk management and performance monitoring
- Active risk-return rebalancing, in response to market cycles
- Structuring cuts, gains or losses in a tax efficient manner
Where PMS functions is ensuring wealth, not just grows, but grows and adapts within your ever-shifting economic landscapes, life stages, aspirations or strategies.
What is Portfolio Management Services (PMS)?
Portfolio Management Services (PMS) are ultimate customizable investing solutions regulated by SEBI for HNIs. Unlike mutual funds, PMS portfolios are built and custodied in your name, allowing for direct ownership of the respective securities while allowing greater transparency.
- Minimum investments: ₹50 lakh (SEBI).
- Ownership: The assets reside in the investor’s Demat account.
- Management: By qualified portfolio managers, and aligned to your investment goals and objectives.
PMS is the premium investment alternative for investors, who require active, customized, and forward-thinking strategies in lieu of traditional funds.
Types of PMS in India
PMS are structured in different ways to meet different investment strategies based on each investor’s preference:
- Discretionary PMS – The portfolio manager will make the investment decisions on your behalf.
- Non-Discretionary PMS – The portfolio manager will provide recommendations, while you make the final decision.
- Advisory PMS – An investment advisor will provide professional advice, while you maintain the control in terms of execution.
Each of these types requires amounts of hands-off delegated-to-openly supervise, ultimately providing the investor with a level of engagement they are comfortable with.
PMS vs Mutual Funds
| Aspects | Portfolio Management Services | Mutual Funds |
| Minimum Investment | ₹50 lakh | As low as 500 |
| Ownership | Direct in your demat accounts | Indirect Fund units |
| Personalisation | Fully customised | One size fits all |
| Control | High | None |
| Transperency | Real time | Periodic NAV updates |
| Tax Treatment | Per holding | Aggregated |
| Suitability | HNIs family offices | Retai and mass investors |
For HNIs PMS advantage lies in Personalisation, active management and control.
What is PMS, in stock market terms?
For equity-centric PMS, stocks are traded in your name and you have transparency and ownership as an investor. This is a direct equity approach vs mutual funds, where you become a unit holder, instead of being positioned as the ultimate stockholder.
Advantages of PMS for HNI Investors
- Customized Asset Allocation – Customized by sector, type of asset and geography
- Direct Ownership – Full visibility and control of all assets in demat account
- Active Risk Management – Tactical rebalancing to safeguard and grow wealth
- Transparency & Reporting – Impactful tracking and reporting on performance with accountability
- Tax Efficiency – Smart execution methods for better after-tax performance
- Access to Unique Opportunities Emerging sectors, pre-IPO allocations, private deals
PMS Pricing in India: The Price of Customized Wealth Management
PMS does generally have a higher fee structure in relation to mutual funds (Primary fees can include):
- Management Fee (1-2.5% per year)
- Performance Fee (10% to 20% of profits earned above a pre-agreed hurdle rate)
- Transaction Charges (brokerage, custodian, audit and operational expenses etc.)
Even though PMS fees may look excessive, the actual value lays in its customization, transparency and its ability to outperform traditional methods.
Reasons behind why HNIs prefer PMS in 2025.
The PMS industry in India has undergone a paradigm shift recently due to:
- Digital onboarding and reporting
- Access to global assets
- Thematic strategies (sustainability, technology, healthcare)
- Integrated solutions for family wealth.
PMS has transformed from being merely an investment vehicle for highly affluent investors into a complete wealth management platform
Conclusion: PMS with Equentis Investech
At Equentis Investech, we appreciate that HNIs expect more than standard solutions. PMS allows you access to personalised strategies, direct ownership, and active portfolio management, unlike traditional funds.
Want to manage your wealth but not sure how? At Equentis Investech, we craft PMS strategies tailored to your goals, legacy, and growth.
Get in touch with Equentis Investech and let’s discuss how PMS can not only help preserve your wealth but allow for it to grow in line with your expectations and facilitate smooth intergenerational transitions.
