Sebi proposals to make portfolio management transparent, investor friendly

Among the significant recommendations for investors, the working group has proposed to raise the minimum investment amount to Rs 50 lakh from the existing Rs 25 lakh

The Securities and Exchange Board of India (Sebi) recently came up with a set of proposals to make portfolio management services (PMS) more transparent, standardise the offerings and make them more investor-friendly. 

While some significant changes have been recommended, the committee has partially touched upon the fee structure, a problematic area for investors to understand.

A PMS can have multiple fee structures which include a fund management fee, profit sharing, and so on. There is no cap on any fee a PMS charges its clients. 

“Due to an increase in competition, most PMS now charge a fund management fee of up to 2.5