Comparative Analysis- Top 5 Performing PMSs vs MFs in India

Portfolio Management Services:

• PMSs are an investment option that can be customised according to the client’s needs and goals. They offer a great deal of personalisation. These services mainly cater to HNIs (high net worth individuals) or institutional investors.

Mutual Funds:

• Mutual funds are a pooled investment option that collect a pool of money from different investors and then invest it in a diversified portfolio like stock, bonds, gold etc. It is managed by a professional fund manager who follows a predefined investment objective and strategy.

To gain a comprehensive understanding about these two seemingly similar yet different investment vehicles, we can compare data points on the top 5 performing PMSs and MFs in the Indian investments space.

TOP 5 PMSs-5 YEAR AUM AND RETURNS:

SCHEME AUM(Cr) RETURNS ANNUALLY Aequitas Investment Consultancy 3020 26% Samvitti Capital 1250 40% Shepherd’s Hill 102 28.80% Green Lantern 379.2 38.89% Asit C Mehta Investment 84.49 30.70%

TOP 5 MFs-5 YEAR AUM AND RETURNS:

SCHEME NAME AUM (Cr) RETURNS ANNUALLY Nippon India 22766 18% SBI Flexicap 20096 16.21% SBI bluechip 43355 16.39% Aditya birla sun life 4981 19.06% ICICI prudential 7415 27%

From a simple graphical analysis of the top 5 PMSs and MFs and their performance over the last 5 years, we can come to a conclusion that PMSs have produced better annualised returns as compared to MFs. This could also be due to the difference in investor classes and the higher volume of individual funds being managed. While PMS may produce higher returns, they also carry more risk due to possibly weaker diversification and aggressive management tactics. This is consistent with the natural trade-off between risk and reward in investing.

Blog By: Adarsh Gupta, Assisted By: Megh Jadhav