Narnolia PMS is one of the leading portfolio management services providers in India. The firm focuses on return enhancement with proper management of risk associated with the portfolio. In order to manage this, Narnolia works out multiple strategies (more on that later) that have consistently proven to be successful for their investors.
Let’s know more.
Narnolia PMS Review
Narnolia PMS is a well-known portfolio management company which was established in the year 1993, in the leadership of Krishna N Narnolia. The headquarter of the company is in Mumbai, Maharastra.
Narnolia is a SEBI registered privately held PMS house. It is famous among the portfolio investors for its quality and performance of the investment portfolio. Narnolia provides discretionary PMS service to the clients.
Narnolia has a team of fund managers and research analysts who are experts in their field with high- quality knowledge and experience. They create a portfolio of clients according to their risk-bearing capacity and return expectations. The clients are allowed to access their portfolio at any given point in time.
The investment approach of the company is unique and based on some key factors which are:
Long term approach: Narnolia adopts the long-term approach to equities. The equities are the best wealth creators in the long-term and the selection of the right equity of the portfolio for risk management is critical.
So, here the PMS model of Narnolia comes which is based on opportunities, potential disruption and the financial.
Performance plus Alpha: As the outperformance of the index is thought to be a big achievement but Narnolia believes that it is just one side of a coin. The firm focus to handle the Asset allocation of the PMS in such a way that it can generate an absolute positive return to the clients on a regular interval of time, not depending on the market condition.
The firm has given the continuous absolute positive return from last 6 years.
Momentum and Capital Allocation: The firm approach is a combination of both capital allocation and identifying the key momentum arises in the market that triggers the maximization of returns over a period of time.
In this article, we will try to cover all important aspects of Narnolia PMS like the types of PMS offered by the firm, manager’s details, portfolio strategies, investment plans, return/performance, support to clients, commission model, benefits etc.
Narnolia PMS Types
Narnolia provides only one type of PMS to the clients – Discretionary PMS. Actually, most of the clients who go to a PMS house is for the discretionary PMS because in this type the risk covered return and capital appreciation become the responsibility of the firm.
In discretionary PMS, the investment portfolio of the client is designed based on the market condition, risk-appetite of the client and wealth creation potential.
In this type of PMS, The decision making power related to the portfolio of the client remains in the hand of the fund manager. A client can only get updates regarding his portfolio.
A fund manager has the right to handle the portfolio of the client according to the market situation or as he thinks better for getting a good return.
Narnolia PMS Manager’s details
Narnolia PMS has a team of experts who handle the investment portfolio of clients from a different perspective.
The research analyst at Narnolia prepare reports on the basis of their research and present it to the fund managers. Now, it is the fund manager who will decide about a particular stock to be added or not in the portfolio.
Now, here are the details of one of the main fund manager’s at Narnolia:
Mr Shailendra Kumar (Chief investment officer):
In the 20 years experience of fund management and research of Narnolia PMS, Mr Shailendra Kumar has played a very important role. Under his leadership, Narnolia has developed widely in investment products ranging from capital appreciation to growth-oriented fund.
He is also an editor of ‘India Quant Analytics’ and ‘Market Twitter’ a publication of the structure of the Indian equity market. He also created more than 69 indexes which include “EW all shares Index” also.
Mr Shailendra has completed IIT from Delhi.
Narnolia PMS Strategies details
The strategies used by Narnolia PMS triggers the risk-free return and capital appreciation for the clients by considering the PMS investment risk. Like most of the PMS Companies, Narnolia also tries to grasp all types of opportunities arises in the stock market, whether it is large-cap, mid-cap, or small-cap.
But, it provides two main strategies which are different from the rest of the PMS house. It makes them unique in terms of the performance of the portfolio used by going through these strategies.
The two PMS strategies of Narnolia are:
- Narnolia PMS: India 3T Fund
- Narnolia PMS: Eagle fund
Narnolia PMS: India 3T Fund
India 3T Fund is a Multi-cap fund, created by the combination of the fundamentals of a company and the quantitative model to make a high-value investment portfolio. It is a mix of both large-cap and mid-cap stocks to get benefit from the stability, growth, and value of both types of stocks.
Here are some of the features of India 3T Fund.
- The 3T fund is a combination of mid-cap and large-cap stocks. The investment portfolio gets the benefit from the growth, value, and stability of these stocks.
- It is a unique strategy which is made on the momentum of earnings that is the fundamentals of a company rather than the price movement only.
- Investment decision taken under this strategy is based on the past data of the companies like balance sheet, profit and loss account and cash flow for several past years. And the growth prospect of the company in the coming years.
- Track record of generating a consistent positive absolute return by beating the benchmark index in the last 5 years out of 6.
- The strategy is designed in such a way that it gives a positive result in the bearish market also.
Hence, we can say, this strategy is made with the view of making an investment in those industries whose earnings and valuation rises continuously.
Narnolia PMS Eagle Fund
Eagle fund is designed to grasp the market opportunities which arise from the short-cap stocks that are based on the proprietary model to arrive at the investment decision.
Here are some of the features of the Eagle Fund:
- Add value to the investment portfolio in its unique way by combining the best of Index beta and Alpha opportunities.
- The total number of stocks in the fund is 20 and beta maintain all the stocks at 1 with focus on market opportunities.
- Has a track record of generating an absolute positive return in the last 5 years.
- The strategy works by adopting a more defensive strategy by minimizing the risk associated with the investment portfolio and maximizing the risk-adjusted return compared to the Index NIFTY.
Narnolia PMS Performance/Returns
Narnolia PMS has maintained the trust of customers by giving an impressive return/performance of the investment portfolio. The firm has given a positive absolute return from last 6 years on a continuous basis.
If we talk about the portfolio management services returns from Narnolia PMS then we can find:
- the 3-year return of Narnolia PMS is 9.5%,
- it is 8.5% for 5 years,
- again the return for 7 years is 11%,
- for 10 years is 12% and
- for more than 11 years the return is 11% CAGR.
So, we can see this robust performance of Narnolia PMS makes it one of the favourite destination for portfolio investors.
Narnolia PMS Investment plan
Narnolia PMS is not different from the rest of the PMS house available in the market. It also gives priority to every category of investors who want to invest with them. It does not matter whether they are small investor/ low-risk appetite or a Big investor/high-risk appetite.
The firm provides equal opportunity for investment to every investor.
So, keeping this in mind, Narnolia PMS provides four basic types of Investment plans which are:
- Bronze (₹25L – ₹50L)
- Silver (₹50L – ₹1 Cr)
- Gold (₹1Cr – ₹5 Cr)
- Platinum (₹5 Cr & above)
The first plan is for small investors who want to make portfolio investment with low amount without taking much risk. The plan is Bronze, start from ₹25L to ₹50 L. The second plan is Silver, the range is ₹50L – ₹1 CR. The Third plan is Gold, one who can invest more than ₹1 Cr and less than ₹5 CR can invest under this plan.
And the last one is Platinum, it is specifically made for those investors who can invest above ₹5CR. and has the capability to take high-risk for getting a higher return.
So, as an investor one can choose the best plan which suits him/her.
Narnolia PMS Commission
Narnolia knows that a satisfied client means a happy company. So, keeping this in mind Narnolia provides different types of commission/fee model to the clients. It will help the clients to make payment to a firm according to their convenience and satisfaction.
A client can make payment to the firm in three different ways decided by the client and the fund manager.
Following are the commission models of Narnolia PMS.
- Prepaid commission model
- Volume-based commission model
- Profit-based commission model.
Prepaid commission model:
The Prepaid commission model is designed for those clients who agree to pay the PMS commission to the fund manager before starting of portfolio service. However, the model is decided by both parties. A fixed percentage of the value of the investment portfolio is decided to be given as the commission.
The more the value of the portfolio, the higher will be the commission.
But, if the portfolio does not perform according to the expectation, the client will have to bear double loss one is the loss from the portfolio and another is loss of commission paid.
Volume-based commission model:
This model is based on the total volume of the transactions completed against the portfolio. Sometimes it requires more transactions to give a positive direction to the portfolio and sometimes few strong transactions are enough for the portfolio.
It depends on the momentum of a particular stock and conditions of the market. But, if the portfolio manager is not genuine, he can increase the number of transactions also just for increasing the volume so that he can charge more commission.
So, the authenticity of a fund manager also plays a vital role in this model.
Profit-sharing commission model:
This is one of the best models for the clients to pay commission to the fund manager. As in this model, the client is assured about the full effort given by the fund manager to the investment portfolio.
The fund manager knows very well that their commission depends on the profit generated. So, he tries to give his best to the investment portfolio of the client.
A fixed percentage of the profit generated out of a portfolio is paid as the commission of the fund manager.
Here is the table that shows the percentage of commission:
Narnolia PMS Charges
Narnolia PMS also takes different types of charges from a client in lieu of providing portfolio management service. These charges are normally in a range between which almost all PMS house charges from the clients. These PMS charges are management fee, brokerage charge, depository charge, custodian fee, exit load fee etc.
Management fee: This fee is charged according to the commission model adopted by both the parties.
Brokerage charges: This charge is levied by the company on the value of the total asset. The range of brokerage charge is 0.005%-0.02%.
Upfront charge: This is a type of prepaid fee that is charged by the firm for giving service to the client. It is charged between 0.5%-0.8% of total asset value.
Custodian charge: This charge is taken as a guardian fee by the company. The range of this charge is between 0.1%-0.3% of total Asset value.
Depository charge: This charge is taken between 0.10% to 0.15% of the total asset value.
Exit load charges: This charge is taken by the company. If a client withdraws the amount before completion of one year of portfolio creation. It is charged between 0.75%- 1.25%. And if the client withdraws an amount after one year of portfolio creation, then no charge will be levied.
Narnolia PMS Benefits
Following are the Benefits of Portfolio Management Services from Narnolia.
- Narnolia provides a master portfolio, which is further customized according to the risk-bearing capacity and return expectation of the clients. This feature is a unique feature of the firm.
- As a client of Narnolia, the securities of your investment portfolio is under your ownership and will remain in Your Demat account. So, you get the right to access your portfolio at all the time.
- The complete transaction of stocks made bought and sold will be in your account. So, the commission/fee or other charges which you are required to pay to the firm will maintain transparency.
- Your investment portfolio is unique and only the master portfolio that is for benchmarking will be the same. It gives better control of your portfolio according to your risk-return expectation.
- The focus of Narnolia is on Absolute return over Alpha. It extracts an opportunity from the combination of stock momentum and value investing with the motive of giving you better risk-return.
- It provides you with customized investment plans and commission model according to your financial strength and risk-appetite.
- Full customer support will be provided to the clients like call, SMS, email and even a direct call to a fund manager also in case of any confusion related to your portfolio.
Narnolia PMS Customer support
Narnolia PMS provides various types of support so that the client does not feel problems for anything related to their investment portfolio.
As a customer of Narnolia, you will get direct calling support to get the answer to your any queries. You can also get the solution of your investment-related problems by WhatsApp and Email.
Narnolia PMS also provides a Relationship Manager support to the clients as well. In order to ask anything, one can call him. In the case of High net-worth clients, Narnolia allows its clients to call the fund manager from 5-7 times in a month while the low-investment clients can call2-3 times in a month.
Narnolia PMS Conclusion
Narnolia PMS is an attractive platform for portfolio investors. It attracts clients by offering them effective strategies which work in different types of market condition and help clients in getting a healthy return.
It provides multiple investment plans to clients so that they can choose any according to their financial strength and risk-bearing capacity. The commission/fee model is also flexible. Narnolia provides various types of support which are greatly useful and well-structured.
Hence, if you are the one who is still searching for a good PMS house, you must include Narnolia PMS in your list of PMS houses.
In case you wish to use PMS for your investments, let us assist you in taking the next steps forward:
Narnolia PMS FAQs
Here are some of the most frequently asked questions about Narnolia PMS:
Why one should invest in Narnolia while many other PMS houses are available in the market?
Narnolia is not only different in providing superior return against the benchmark to the clients but it also focuses on the quality of return that is measured in term of risk-adjusted return. Narnolia is offering those products and solutions to the clients which other PMS houses wish to emulate.
Is it safe to rely on a relationship manager who runs behind his own target?
Yes, the concern is right from the point of view of a client. But, Narnolia trains its relationship managers in such a way that his target remains incomplete without customer satisfaction. The relationship managers at Narnolia knows very well that their growth is linked to client satisfaction and compliance. RM are rewarded by the company with ESOP for attitude.
So, A relationship manager keeps his/her relation with a client beyond professional relation and see their growth in the growth of the clients.
How much return can a client expect from his investment portfolio at Narnolia?
Narnolia PMS discuss the length of investment and risk-bearing capacity with the client before creating investment basket. This is because all the investment products are developed with the view of long term investment purpose. So, all products have different risks and different return over a period of time.