Investor Charter in Respect of Portfolio Management Services
Annexure- A
A. Vision and Mission Statements for investors.
Vision:
To implement diligently researched customized investment strategies which help
investors meet their long-term financial goals in a risk appropriate manner.
Mission:
To ensure that the PMS industry provides a viable investment avenue for wealth
creation by adopting high levels of skill, integrity, transparency and accountability.
B. Details of business transacted by the organization with respect to the
investors.
a. appropriate risk profiling of investors
b. to provide Disclosure Document to investors
c. executing the PMS agreement
d. Making investment decisions on behalf of investors (discretionary) or investment
decisions taken at the discretion of the Investor (non -discretionary) or advising
investors regarding their investment decisions (advisory), as the case may be.
C. Details of services provided to investors and estimated timelines:-
i. Discretionary & Non-Discretionary Portfolio Management Services (PMS):-
Under these services, all an investor has to do, is to give his portfolio in any form
i.e. in stocks or cash or a combination of both. The minimum size of the portfolio
under the Discretionary and/ or Non-Discretionary Funds Management Service
should be Rs.50 lakhs as per the current SEBI Regulations. However, the PMS
provider reserves the right to prescribe a higher threshold product -wise or in any
other manner at its sole discretion. The PMS provider will ascertain the investor’s
investment objectives to achieve optimal returns based on his risk profile. Under
the Discretionary Portfolio Management service, investment decisions are at the
sole discretion of the PMS provider if they are in sync with the investor’s investment
objectives. Under the Non-Discretionary Portfolio Management service,
investment decisions taken at the discretion of the Investor.
ii. Investment Advisory Services: -
Under these services, the Client is advised on buy/sell decision within the overall
profile without any back-office responsibility for trade execution, custody of
securities or accounting functions. The PMS provider shall be solely acting as an
Advisor to the Client and shall not be responsible for the investment/divestment
of securities and/or administrative activities on the client’s portfolio. The PMS
provider shall act in a fiduciary capacity towards its Client and shall maintain arm’s
length relationship with its other activities. The PMS provider shall provide advisory
services in accordance with guidelines and/or directives issued by the regulatory
authorities and/or the Client from time to time in this regard.
iii. Client On-boarding
a. Ensuring compliance with KYC and AML guidelines.
b. Franking & signing the Power of Attorney to make investment decisions on
behalf of the investor.
c. Opening demat account and funding of the same from the investor’s verified
bank account and/or transfer of securities from verified demat account of the
investor and
d. Mapping the said demat account with Custodian.
iv. Ongoing activities
a. To provide periodic statements to investors as provided under the PMS
Regulations 2020 and other SEBI notifications and circulars (“PMS
Regulations”) and
b. Providing each client an audited account statement on an annual basis which
includes all the details as required under the PMS Regulations.
v. Fees and Expenses
Charging and disclosure of appropriate fees & expenses in accordance with the
PMS Regulations. (For more details pls refer attached Disclosure document)
vi. Closure and Termination
Upon termination of PMS Agreement by either party, the securities and the funds
lying in the account of the investor shall be transferred to the verified bank account/
demat account of the investor. (For more details pls refer attached Disclosure
document)
vii. Grievance Redressal
Addressing in a time bound manner investor’s queries, service requests and
grievances, if any, on an ongoing basis. (For more details pls refer attached
Disclosure document)
Timelines of the services provided to investors are as follows:
Sr.
No.
Service / Activity
Timeline
1
Opening of PMS account
(including demat account) for
residents.
7 days from receipt of all requisite documents
from the client, subject to review of the
documents for accuracy and completeness by
portfolio manager and allied third party
service providers as may be applicable.
2
Opening of PMS account
(including demat account) for
non-individual clients.
14 days from receipt of all requisite documents
from the client, subject to review of the
documents for accuracy and completeness by
portfolio manager and allied third party
service providers as may be
applicable.
3
Opening of PMS account
(including demat account, bank
account and trading account)
for non-resident clients.
14 days from receipt of all requisite documents
from the client, subject to review of the
documents for accuracy and completeness by
portfolio manager and allied third party
service providers as may be
applicable.
4
Registration of nominee in
PMS account and demat
account.
Registration of nominee should happen along
with account opening, therefore turnaround
time should be same as account opening
turnaround time.
5
Modification of nominee in
PMS account and demat
account.
10 days from receipt of requisite nominee
modification form, subject to review of the
documents for accuracy and completeness by
portfolio manager and allied third party
service providers as may be applicable.
Sr.
No.
Service / Activity
Timeline
6
Uploading of PMS account in
KRA and CKYC database.
10 days from date of account opening
(Portfolio Manager may rely on the custodian
for updating the same).
7
Whether portfolio manager is
registered with SEBI, then
SEBI registration number.
At the time of client signing the agreement; this
information should be a part of the account
opening form and disclosure document.
8
Disclosure about latest
networth of portfolio manager
and total AUM.
Disclosure of portfolio manager's total AUM -
monthly to SEBI
Disclosure of latest networth should be done
in the disclosure document whenever there
are any material changes.
9
Intimation of type of PMS
account – discretionary.
At the time of client signing the agreement;
this information should be a part of the
account opening form.
10
Intimation of type of PMS
account - non discretionary.
At the time of client signing the agreement;
this information should be a part of the
account opening form.
11
Intimation to client what
discretionary account entails
and powers that can be
exercised by portfolio
manager.
At the time of client signing the agreement; this
information should be a part of the account
opening form.
12
Intimation to client what non -
discretionary account entails
and powers that can be
exercised by portfolio
At the time of client signing the agreement; this
information should be a part of the account
opening form.
Sr.
No.
Service / Activity
Timeline
manager.
13
Copy of executed PMS
agreement sent to client.
Within 3 days of client request.
14
Frequency of disclosures of
available eligible funds.
All details regarding client portfolios should be
shared quarterly (point 26).
15
Issuance of funds and
securities balance statements
held by client.
This data should be shared on a quarterly
basis or upon client request.
16
Intimation of name and demat
account number of custodian
for PMS account.
Within 3 days of PMS and demat account
opening.
17
Conditions of termination of
contract.
At the time of client signing the agreement;
this information should be a part of the
account opening form.
18
Intimation regarding PMS fees
and modes of payment or
frequency of deduction.
At the time of client signing the agreement;
this information should be a part of the
account opening form.
19
POA taken copy providing to
client.
Within 3 days of client request.
20
Intimation to client about what
all transactions can portfolio
manager do using PoA.
At the time of client signing the agreement;
this information should be a part of the
account opening form.
21
Frequency of providing
audited reports to clients
Annual.
22
Explanation of risks involved
in investment.
At the time of client signing the agreement;
this information should be a part of the
account opening form.
Sr.
No.
Service / Activity
Timeline
23
Intimation of tenure of portfolio
investments.
Indicative tenure should be disclosed at the
time of client signing the agreement; this
information should be a part of the account
opening form.
24
Intimation clearly providing
restrictions imposed by the
investor on portfolio manager.
Negative list of securities should be taken from
the client at the time of client signing the
agreement; this information should be a part
of the account opening form.
25
Intimation regarding settling of
client funds and securities.
Settlement of funds and securities is done by
the Custodian. The details of clients’ funds and
securities should be sent to the clients in the
prescribed format not later than on a
quarterly basis.
26
Frequency of intimation of
transactions undertaken in
portfolio account.
Not later than on a quarterly basis or upon
clients' request.
27
Intimation regarding conflict of
interest in any transaction.
The portfolio manager should provide details of
related party transactions and conflict of
interest in the Disclosure Document which
should be available on website of portfolio
manager at all times.
28
Timeline for providing
disclosure document to
investor.
The latest disclosure document should be
provided to investors prior to account opening
and the latest disclosure documents should be
available on website of portfolio manager
at all times.
29 Intimation to investor about Within 3 days of PMS and demat account
Sr.
No.
Service / Activity
Timeline
details of bank accounts
where client funds are kept.
opening
30
Redressal of investor
grievances.
Within 30 days, subject to all the information
required to redress the complaint is provided
by the complainant to the portfolio manager
Notes:
1 The number of days in the above timelines indicate clear working days
.
D. Expectations from the investors (Responsibilities of investors)
1. Check registration status of the intermediary from SEBI website before availing
services.
2. Submission of KYC documents and application form in a timely manner with
signatures in appropriate places and with requisite supporting documents.
3. Read carefully terms and conditions of the agreement before signing the same.
4. Thorough study of the Disclosure Documents of the PMS to accurately understand
the risks entailed by the said investment in PMS.
5. Accurate and sincere answers given to the questions asked in the ‘Risk
Questionnaire’ shall help the PMS provider properly assess the risk profile of the
investor.
6. Thorough study of the quarterly/ Monthly statements sent by the PMS provider to
the investor intimating him about the portfolio’s absolute and relative
performance, its constituents and its risk profile.
7. Ensure providing complete details of negative list of securities as part of freeze
instructions at the time of entering into PMS agreement and every time thereafter
for changes, if any, in a timely manner.
8. To update the PMS provider in case of any change in the KYC documents and
personal details and to provide the updated KYC along with the required proof.
E. Details of grievance redressal mechanism and how to access it
1. It is mandatory for every PMS provider to register itself on SEBI SCORES (SEBI
Complaint Redress System). SCORES is a Centralized online complaint resolution
system through which the complainant can take up his grievance against the PMS
provider and subsequently view its status. (https://scores.gov.in/scores/ Welcome.html )
2. The details such as the name, address and telephone number of the investor relations
officer of the PMS provider who attends to the investor queries and complaint should be
provided in the PMS Disclosure document.
3. The grievance redressal and dispute mechanism should be mentioned in the Disclosure
Document.
4. Investors can approach SEBI for redressal of their complaints. On receipt of complaints,
SEBI takes up the matter with the concerned PMS provider and follows up with them.
5. Investors may send their complaints to: Office of Investor Assistance and Education,
Securities and Exchange Board of India, SEBI Bhavan. Plot No. C4- A, G‟ Block, Bandra-
Kurla Complex, Bandra (E), Mumbai - 400 051.