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Sanjeev Govila192 Answers  |Ask -

Financial Planner - Answered on Jun 01, 2023

Asked on - Jun 01, 2023

Dear Govila Sir, I am 61 year old, retired from my services having 23L in MF, 24L in shares and sufficient arrangement to cater my daily expenses. Now I find it difficult to concentrate on my portfolios, so thinking of selling my MF and shares and invest in PMS (50L in Marcellus consistent compounders) to gift the amount to my son and daughter after say 15 years. Request you to please give your advice on this matter. With Thanks & Regards Sarvotham
Ans: Dear Sarvotham
PMS might seem alluring but my experience has been that the performance of most of them is patchy and quite irregular. A well performing PMS is generally not able to repeat the performance even the next year.

The reasons for the above are not very far to seek. PMS’ generally keep very concentrated portfolios and that too of mid and small stocks, and hence, the risks taken are very high. If the risk taken plays out, the PMS performs in that year. With your available money, you will have to invest in one single PMS since the minimum investment allowed is 50 Lakhs.

On the other hand, equity mutual funds typically have 40-60 stocks in portfolio and since there is no minimum investment limit like in PMS, you can have a well diversified portfolio which will reduce your risks and also have a balance.

My suggestion is to search out a good financial advisor and take his/her advice to manage the portfolio. That way you would you would not have to manage the portfolio yourself which you are finding difficult to do, costs will be much lower as the PMS typically charge much higher fees and you would also have a control on your portfolio which you will not have in PMS.

By the way, 61 years is not such a high age… my age is the same as yours!! 😊
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