What are the Charges for PMS?

Last Updated: 7 Aug 2025

Portfolio Management Service (PMS) is a facility offered by a SEBI registered portfolio manager with the singular intent to achieve the required rate of return within the desired level of risk for the client. That is a specialized service and entails charges called portfolio management charges. An investment portfolio can be a mix of stocks, fixed income, commodities, real estate, and other structured products but getting them, all together is quite a complex task. That is why portfolio management charges are quite steep in the Indian context.

The portfolio manager is a licensed investment professional who specialises in analysing an investor’s financial goals and brings extensive expertise in navigating various market instruments. To compensate for this specialised service, charges are typically levied at a relatively steep rate. 

Among these, the fixed fee PMS model involves charging a set percentage of the assets under management, regardless of performance. Additionally, there’s the performance fee PMS structure, where charges are based on the profits generated above a specified benchmark. Let us now explore PMS charges in greater detail.

What is PMS?

Portfolio Management Service (PMS) is a specialised investment solution provided by a professional portfolio manager, aimed at achieving a specific rate of return while aligning with the investor’s risk appetite. It involves the careful construction and management of an investment portfolio, which may include a mix of equities, fixed-income securities, commodities, real estate, structured products, and cash.

Offered primarily to high-net-worth individuals (HNIs), PMS is a personalised service tailored to meet the unique financial goals and risk preferences of each investor. The process begins with drafting an Investment Policy Statement (IPS), which outlines the client’s current financial standing, return expectations, and risk tolerance. 

The portfolio manager uses this document to ensure all investment decisions are in sync with the client’s objectives. Additionally, key factors such as investment duration, tax implications, and liquidity needs are carefully considered before designing the strategy.

Types of PMS Charges

The PMS charges the following fees, and these may vary from one PMS provider to another. We will first look at a list of all portfolio management charges, or PMS charges, as well as actual portfolio management charges imposed by some of the leading PMS players in India. The charges are decided at the time of investment and are vetted by the investor. Here is a quick look at the list of PMS charges.

• Entry Load PMS is charged by most of the schemes, and these charges vary between 1% and 3%. These PMS charges are only charged at the time of buying into the PMS.
• There is a recurring cost in the form of Management Charges. After all, the portfolio has to be managed. The portfolio management charges will surely be higher than those of mutual funds because mutual funds don’t customise. Every Portfolio Management Services scheme charges Fund Management charges to its clients. These charges may vary from 1% at the lower end to 3% at the higher end, and this varies vastly depending upon the PMS provider. These PMS charges are levied every quarter to the PMS account.
• A distinct aspect of PMS charges is the profit-sharing model. While not all Portfolio Management Services follow this structure, many of the more aggressive or performance-driven schemes do. In most cases, profit-sharing fees are levied in addition to a fixed management fee. 
• Under this model, the PMS provider assures a minimum return threshold – profits generated beyond this benchmark become eligible for sharing. For instance, a PMS may state that returns up to 10% are entirely the investor’s, but any returns exceeding that will be split, typically in an 80:20 ratio, with 80% going to the investor and 20% to the PMS manager.
• Another cost component is the exit load, which applies if an investor withdraws funds before a specified period, usually 1–2 years. Clients who stay invested beyond two years are generally exempt from this charge. However, the exit load has been a point of contention and debate, even though it continues to be used as a tool by PMS providers to promote long-term client retention.

In addition to the above charges, PMS service providers levy additional charges on the customer for several services provided, like custodial fees payable to the custodian, Demat charges, and Demat movement charges payable to the NSDL / CDSL. In addition, PMS also levies the audit fees to the client, and in many cases, even the brokerage or transaction and statutory charges are also billed to the client. Normally, such billing is done at a much higher rate on cash market volumes than what the PMS pays to the broker. 

Some providers adopt a hybrid fee PMS structure, combining elements of both fixed and performance-based fees, and may still pass on these additional service-related costs separately to the client.

What are PMS charges or Portfolio Management Charges

• PMS charges levied by Porinju Velliyath include a 2% fixed fee and 10% above 10% as a profit participation fee.
• PMS charges at Motilal Oswal include 2-2.5% as a fixed fee and 0.3% brokerage per cash market transaction, as well as 1-2% exit load.
• The PMS charges at ASK Wealth include a 2.5% fixed fee and 1.5% plus 20% above 10% returns and profit participation.
• PMS charges at Alchemy PMS are restricted to around 2.5% fixed maintenance charges per year.
• Kotak PMS levies PMS charges at 2.5% as a fixed fee per year, 0.1% brokerage per transaction, as well as 1-3% as exit load depending on the holding period.
• ICICI PMS levies PMS charges at 1% to 3% fixed fee per year, as well as 2% to 2.5% as exit loads based on the timing of exit.
• Birla Sun Life PMS levies PMS charges at a 2.5% upfront fee and 1.2% to 2.2% as exit loads depending on the holding period.
• Angel Broking puts PMS charges at a 2% upfront fee and 0.5% as brokerage per transaction in the cash segment.

Here’s a tabular overview of the PMS service charges –

PMS Provider	Fixed Fee	Brokerage	Exit Load	Profit Participation
Porinju Velliyath	2% per annum	–	–	10% of returns above 10%
Motilal Oswal	2% – 2.5% per annum	0.3% per cash market transaction	1% – 2%	–
ASK Wealth	2.5% per annum	–	–	1.5% + 20% of returns above 10%
Alchemy PMS	~2.5% per annum	–	–	–
Kotak PMS	2.5% per annum	0.1% per transaction	1% – 3% (based on holding period)	–
ICICI PMS	1% – 3% per annum	–	2% – 2.5% (based on exit timing)	–
Birla Sun Life PMS	2.5% upfront	–	1.2% – 2.2% (based on holding period)	–
Angel Broking	2% upfront	0.5% per transaction (cash segment)	–	–

How to Open a PMS Account?

The portfolio manager, before taking up an assignment of management of funds or portfolio of securities on behalf of the client, agrees in writing with the client, clearly defining the relationship and setting out mutual rights, liabilities, and obligations relating to the management of funds or portfolio.

Frequently Asked Questions

1. What are PMS charges, and why are they considered high in India?

Portfolio Management Services (PMS) charges are fees levied by licensed portfolio managers for managing and customising an investor’s portfolio based on their financial goals and risk appetite. The answer to what are PMS charges typically include: an entry load, fund management fee, profit-sharing fee, and exit load. 

2. What are the main components of portfolio management services charges?

The primary portfolio management services charges include an entry load (usually 1–3%), annual management fees (ranging from 1% to 3%), profit-sharing (e.g., 10% above 10% returns), and an exit load if exited before a specific period (usually 1–2 years).

3. How do PMS charges in India differ among popular service providers?

PMS charges in India vary widely depending on the service provider. For instance, Porinju Velliyath’s PMS levies a 2% fixed fee with 10% profit-sharing above 10% returns, while ASK Wealth charges 2.5% as a fixed fee with a profit share of 20% above 10% returns. 

4. Are there any hidden or additional charges under PMS?

Yes, apart from standard PMS fees, investors should be aware of additional portfolio management services charges such as custodial fees, Demat charges, audit fees, transaction charges, and statutory levies.