Sahare Wealth · PMS & AIF
PMS & AIF, for larger portfolios
Portfolio Management Services and Alternative Investment Funds are SEBI-regulated options for investors with larger amounts to invest. We help you understand how they work, compare managers and fees, and decide with care.
- SEBI-registered managers only
- Fees explained upfront
- Help from Nagpur
Compare
Mutual fund, PMS or AIF?
All three are regulated by SEBI, but they differ in how much you need, what you own and how easily you can exit.
| Feature | Mutual fund | PMS | AIF |
|---|---|---|---|
| Minimum investment | Small amounts; varies by scheme | ₹50 lakh | ₹1 crore (accredited investors exempt) |
| What you hold | Units of a pooled scheme | Shares and securities in your own demat account | Units of a pooled fund |
| Personalisation | None | Some, depending on the service | None; same strategy for all investors |
| Exit | Most open-ended schemes: any business day | Usually possible; exit load may apply in early years | Often locked in until the fund closes; some Category III funds are open-ended |
| Fees | Expense ratio, capped by SEBI | Fixed fee, performance fee or both, as agreed | Management fee, often with a share of profits, as per fund documents |
| Key document | Scheme Information Document | Disclosure Document and PMS agreement | Private Placement Memorandum |
Portfolio Management Services
How PMS works
A SEBI-registered portfolio manager runs a portfolio for you. The shares and securities stay in a demat account in your name.
Discretionary
The manager decides what to buy and sell, within the objectives agreed with you. This is the most common type.
Non-discretionary
The manager suggests trades, you approve each one, and the manager executes them.
Advisory
The manager only advises. You decide and place the trades yourself.
What you get
- Securities held in your own demat account
- A Disclosure Document before you sign, with fees, risks and past performance
- Regular statements on holdings, transactions and performance
- A direct option: SEBI requires managers to let you invest without a distributor
What to check before signing
- The manager's SEBI registration and investment team
- The strategy and how concentrated the portfolio is
- All fees: fixed, performance-linked, exit load and other charges
- Performance over full market cycles, not just the best year
Alternative Investment Funds
The three AIF categories
An AIF pools money from investors and invests as per its Private Placement Memorandum. Many are close-ended, and your commitment may be drawn in stages as the fund invests.
Category I
Early-stage and priority sectors
Venture capital, angel, SME, social impact and infrastructure funds.
Category II
Private equity and private credit
Private equity, debt and other funds that are not in Category I or III. They don't borrow except for short-term needs.
Category III
Complex trading strategies
Long-short and other strategies that may use derivatives and borrowing. Can be open- or close-ended.
Higher riskGet started
How to invest
PMS and AIF are long-term commitments. Take time over each step.
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Discuss your goals
We'll look at your existing portfolio, time horizon and eligibility, and whether PMS or AIF fits at all.
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Shortlist managers
Compare SEBI-registered managers on strategy, team, track record and total fees.
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Read the documents
For PMS, the Disclosure Document and agreement. For AIF, the Private Placement Memorandum and contribution agreement. Check fees, lock-in and exit terms.
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Complete KYC and invest
For PMS, a demat account is opened in your name and funded from your own bank or demat account. For an AIF, you pay as per the fund's drawdown schedule.
Before you invest
Risks to understand
Concentrated portfolios
PMS and AIF portfolios often hold fewer stocks, so they can rise or fall much more than the market.
Fees reduce returns
Fixed and performance fees can take a large share of gains. Compare returns after all fees.
Money may be locked in
Close-ended AIFs usually can't be exited before the fund ends. Invest only money you won't need.
Past returns aren't promises
A strong track record doesn't guarantee future results. Anyone promising fixed returns is a red flag.
Verify registration
Invest only with managers registered with SEBI. Check on the SEBI website (opens in a new tab).
Raise complaints
Unresolved complaints can go to SEBI's SCORES portal (opens in a new tab), and then to SMART ODR (opens in a new tab).
Official sources
Check the details yourself
Questions
Frequently asked questions
Can I invest less than ₹50 lakh in PMS?
No. ₹50 lakh is SEBI's minimum for PMS, and some managers set a higher amount.
Can I use my existing shares for PMS?
Many portfolio managers accept existing shares towards the minimum, valued as per their policy. The manager may sell some of them to fit the strategy, which can lead to capital gains tax.
Who is an accredited investor?
An investor who holds an accreditation certificate from a SEBI-recognised agency, based on income or net worth criteria set by SEBI. Accredited investors are exempt from the minimum investment in some products, including AIFs.
Can I exit an AIF early?
Usually not from a close-ended fund before it ends. Some funds allow units to be transferred, as per their terms. Check the Private Placement Memorandum before you commit.
How are PMS and AIF taxed?
In PMS, you pay tax on gains and income as if you held the securities yourself. AIF taxation depends on the category. Please check with your tax adviser.
Does Sahare Wealth guarantee returns?
No. Returns depend on markets and the manager's decisions. We help you understand the options and the documents; the investment decision is yours.