PMS is an exclusive service extended to High Networth Individuals (HNIs) and institutions. You must be wondering why it is for a limited client base. The reason for this limitation is the minimum investment in PMS.
Portfolio Management Services aims to reduce the risk involved in the investments of the client. This reduction is possible due to the diversification of the investment portfolio.
A fund manager is hired by the client to manage his assets.
SEBI has been regulating the PMS industry since 1993. Before notifying the first regulation notification, the industry was free of any rules and regulations. This freedom made investors and managers equally vulnerable to malpractices.
SEBI Portfolio Managers Regulations 1993 was the beginning of a new era in the PMS industry.
The latest notification relating to this regulation was notified in November 2019. So, to be eligible for Portfolio management services in 2020, the investor must have a minimum investment in PMS of ₹50 lakhs.
PMS Minimum Investment SEBI
After SEBI announced the Portfolio Managers Regulations in 1993, it has been amended multiple times. Many notifications have been issued concerning the regulations.
Initially, the minimum investment in PMS was ₹25 lakhs. Over time, SEBI felt the need to increase it, and thus, a notification in November 2019 was issued.
This notification clearly stated an increase in the minimum investment in PMS to ₹50 lakhs.
Minimum Amount for PMS in India
Portfolio Management Services is not exclusive to India. It is provided to investors in various names across the globe. With a distinction in the title, a different amount is decided upon for extending the service.
The minimum amount for PMS in India is specified by the Indian Stock Market’s regulatory body – SEBI. SEBI has notified the minimum amount to be ₹50 lakhs.
This amount was recently increased from ₹25 lakhs to safeguard the small investors.
The PMS industry and the Indian Stock Market are both regulated by SEBI. The PMS industry was regulated after 1993 using the SEBI portfolio managers’ regulations, 1993.
This regulation was recently amended to increase the minimum investment in PMS to ₹50 lakhs.
We sincerely hope that your query regarding the minimum investment amount required for availing the PMS is cleared.
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