Anybody invested in club millionaire financial services PMS ?
GOOD TEAM
VERY GOOD PERFORMANCE
Kind of companies Basant Maheshwari invest in with high concentration ie High quality + High Growth generally give an exit at 20-30% below price and donāt fall like a pack of cards in a few days.
Philosophy is too much of a good thing can be wonderful.
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Which PMS are you talking? Have you personally invested?
http://clubmillionaire.in/our-vision-mission/
http://clubmillionaire.in/investment-philosophy/
http://clubmillionaire.in/club-millionaire-difference/#1502966527671-286fa195-2456
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I am very impressed with club millionaire PMS performance and the investment philosophy.
Other thing I noticed is that, they dont come on TV/twitter etc and brag about the performance.
Disc: Not invested in any PMS and dont intend to. Imo, do it yourself is the best.
79 PMSes across large, mid & smallcaps outperformed Sensex in September
Download moneycontrol app: http://m.moneycontrol.com/mom
While some PMS investment could give you good returns, but not always. Recently, I had invested in Alchemy capital PMSā¦ I lost money due to extremely poor performance which i thought I must alert members in this forumā¦
(1) The Alchemy capital PMS put my money in stocks like Zee entertainment, Sterling and Wilson solar, Bajaj electrical , TCNS clothing, Mahindra & Mahindra, Sundaram fasteners, Delta corporation ,Zensar technology to name a fewā¦
After 1 year , my portfolio return was negative. When i found that my money has been invested in over leveraged companies with corporate governance issues and some of these stocks tanked by 50% , I exited by paying a heavy exit chargesā¦
(2) Nowadays , all charges such as entry charges , management fees and exit charges are levied with 18% GST. It is quite expensive. To give an example , for managing Rs25 Lakh, they charged 1.6 lakh feesā¦which comes to more than 6%ā¦
(3) I think, they have compulsion of buying some specific stocks ā¦ Only God knows whatā¦ but these are not fundamentally sound stocks ā¦
(4) while the management charges are 5 star, but the stocks selected are one star. ā¦
(5) During the same period when Multicap mutual funds have given 15-25 % ( Kotak multicap, Axis focussed 25 fund, Mirae emerging blue chip) , Alchemy capital PMS had given just -2% ā¦
(6) A mutual fund fund manager is always on his toes as his performance is being flashed in all digital mediaā¦ But the PMS manager like Alchemy ā¦ They are least bothered about investors moneyā¦
(6) i started reading this forum and i started buying stocks on my own some 4-5 months backā¦
I think it is no brainer ā¦ I put my money on well known popular stocks some 4 months back and i am happy that i made 20% return during 4 months timeā¦
My stocks are ā¦ HDFC , HDFC AMC, Bajaj Twins , Asian paint, Bata, Jubilant food, IRCTC, IGL, Mahanagar Gas, Tata Global beverages, Page industries, Infosys, Abbott, pfizer, Lal Path Lab, Ion exchange, pidilite, HUL, Icici bank,
These kind of stocks will never ditch youā¦
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Fair open minded comment for PMS. They secure themselves with exorbitant charges and leave investor on mercy of their unknown agenda of buying specific stocks. Recently regulators increased the entry ticket size but closed their eyes while reviewing the charges. These are one of the highest among other available fund management options for retailers.
Last few months have been good (my own portfolio has grown by 45% in similar time frameā¦that too without any activityā¦ sometimes being inactive also helps) but the real test is when we stick to our thesis in bad days (e.g. Janā18 - Sepā19 or maybe Year 2008). If we are able to beat major indices return during tough period, certainly we are on right path.
I like most of the stocks chosen by you, it will be good to have your exit triggers defined & documented, which can be return based (x% on your entry or any major event indicating change in fundamentals etc)
This is the beauty of this forum. You canāt go wrong if you listen with open mind. We have a nice community helping each other without any ownership bias.
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Thanks for your comment.
As regards to the PMS, planning to lodge a complaint with SEBI Investor protection cellā¦ i suppose they have a online complaint management system.
With regards to my current portfolio, i picked up stocks after a lot of learning from all of you in this forumā¦
Yes , Timing of entry and exit for a stock is important but is difficult to comprehend and that is where i do mistakes but yes I need to learn ā¦ But it is necessary (1) as and when fundamentals change and / or (2) when the stock gives you your pre-determined and documents targeted return ā¦ as you have rightly said ā¦
Because even if you select high conviction stocks , fundamentals of a company can change over a period of time ā¦
Setup fee can be charged/waived off at the discretion of the intermediary, this is usually 1% at the max for most PMS. The annual management fee is in the range of 2 - 2.5% plus applicable taxes if one goes for the fixed fee model. There is also an exit load that each PMS charges, in some case the exit load structure is tiered like 3% if redeemed within 1 year, 2% if redeemed within 2 years, 1% if redeemed within 3 years.
All these are documented and presented to the investor when they sign the documentation for the same. If you have bought the PMS through a wealth manager/intermediary it is their duty to disclose this to the investor proactively, the PMS operators (Alchemy, Motilal Oswal, ASK etc) most of the time do not even meet the investor. This is how distribution works in any industry, leave alone PMS.
If there is anyone to be taken to task it has to be the intermediary who sold the product to you and pocketed the 4% upfront fee from the PMS. The PMS actually loses money when an investor pulls out within the first 2 years.
Sometimes poor performance is due to the fact that the money was invested during the peak of the bull market frenzy. That is when most distributors sell PMS anyway and that is also when most investors get attracted to a PMS.
The PMS agreement you would have signed would have mentioned all terms and conditions in detail, they even taken your signature on the specific fee schedule to acknowledge that you are aware of and have understood the fee schedule including setup fee, annual management fee and exit load structure.
Sometimes with the best of intentions and ability, fund managers go wrong in their assessment and investors do have to live with losses. Unless one can prove malafide intent there is nothing that SEBI will do for anyone who has signed agreements before investing into a PMS.
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@1957 Being from the fund management industry, I do not agree with your observations here.
First of all, what a decent PMS buys (while not commenting on the one you have invested in) is after a lot of research and hard work. The portfolio constituents are the proprietary information of the PMS and I do not think you should disclose the names publicly without taking prior permission from the PMS team. Secondly, you should compare your notes about what the PMS manager strategy was at the time of your investment and whether the same has drastically changed after you invested. If you have done your diligence, you would have maybe cared to ask them on a few stocks in the portfolio. Please see if those stocks or the nature of those stocks are vastly different than what you have bought. For instance, if they were in the strategy of buying HDFC Bank like stock (constant compounders) or Zee entertainment (cyclical recovery plus pledging problem going away).
Also, if the PMS strategy was long term oriented, just because your portfolio has gone negative in a single year doesnāt mean that it is the fault of a PMS manager as long as the strategy consistency is there.
Again, if you exit in one year - you will end up paying exit load (if you had signed on the same) apart from management fee and maybe even set up fee at the time of entry. These fees are always disclosed and are included in the agreement you signed on. If you didnāt read the agreement, then the fault is yours. Also, GST is a government requirement, there is nothing a fund manager can do. If you donāt like the fee structure, you should try to negotiate the same with the PMS or just not invest in it.
Please first understand why the PMS or advisory industry exists as different from mutual funds. A mutual fund is meant for all and sundry including retail money which doesnāt know or need to know anything. Anyone with 5000 rs can also invest in an MF. A PMS is supposed to be a sophisticated product meant only for HNIs who have the knowledge and appetite to invest in a way very different from a typical MF (who are generally busy tracking the index only) and hence take theoretically higher risk - risk being defined by volatility and not by the real risk - to achieve higher returns. This is generally only possible by being contrarian, event-driven or concentrated or some other exotic strategy and hence have very different allocations than the index. Sometimes such strategies can also yield very low correlations with the index which is great from a diversification of overall portfolio point of view.
It is rather unfortunate that many PMS today are buying HDFC Bank and Asian Paints (just because such stocks have done very well in a slowing economy) and charging a much higher fee than what investors can either buy on their own or through a low-cost index fund. I repeat the foremost aim of a PMS - its reason for existence - has to be creation of a large alpha - something which one canāt get by buying the market index heavy-weights.
Please compare the market share of funds managed under PMS vis-a-vis mutual funds in equity. If this was true then such a major shift wouldnāt have happened. Mutual fund managers on average are only focused on the day to day performance and very few of them are long term oriented. The alignment of interest is also very little as AUM is gigantic. Again saying this from my real-life working experience of knowing and working with old and new mutual fund managers. Most mutual fund managers and I can say this with a lot of confidence will fail to create any alpha over the long term. Most large-cap mutual fund managers have the same stocks in the portfolio is slightly different weights. Last one year, few large caps with heavy index weights have done well and since most mutual fund managers align themselves with index rather than have any intention of creating large alpha over the long term have done better than what value-focused fund managers in the PMS industry have.
Sir, in the stock markets you can be wrong and still be right and you can right and still be wrong. Currently, the Indian economy has fallen into an unprecedented slowdown. Now what happens in a slow down is very well known - money moves in the best of quality and best-known stocks. Thatās how this no brainer 20% has been created - not because one has skill or knowledge to create this 20% every year forget about every 4 months. If creating 20% was easy then the sales of Mercedes cars in India would not be a few thousand units but maybe a few lakhs every year. If there is one truth that I have learned about stock markets - there are no cinches or sure things in the stock markets.
Assuming the slow down ends in the next few years or so - the money that one can make in the beaten-down stocks is going to be much more than than the ones you have mentioned here. How the future will unfold - only time will tell. The question is whether you are comfortable with quality at any price strategy (like the one you seem to have bought into) or whether you are comfortable with contrarian strategy (that your PMS seem to have bought into). This seems to be a case of mismatch of your understanding and requirement vis-a-vis what this PMS had to offer more than anything else.
Overall I feel that its a high likelihood your distributor (if, any) is at fault here more than the PMS itself. Most distributors are in the business of selling anything which can be sold as they make upfront commissions (something which SEBI is now trying to curb down). In many cases investors, even HNIs, are clueless and sign on things without knowing about the details. In case this was sold to you by a distributor, talk to him to compensate you partly for all this. If they value you they might do something good for you.
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Let us agree to disagree with the viewsā¦ 
one can always have his own viewsā¦
My only point is that in a basket of 20 stocks, if multiple stocks go down by 50-60% within 4-6 months, it can not be said that these were well researched stocks.
What would we say if during the same period there are a list of 20 other PMS schemes under similar situations and multicap strategy , all these PMS schemes have managed to get 20-30% returnā¦and this one gives negative return
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This booklet published by PMSBazaar contains useful information like Total Aum, No. of Investors, Details of Investment philosophy, Fee Structure, Investment Team, Profile of the Portfolio Manager, Key Strength of the Strategy etc,
136 Pages of Useful Information on PMS and AIF
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Thanks. @1957
Your first sentence of does high risk PMS give high rewards over the long run? Iād really like to find out 
. But for mutual funds its easy to go to moneycontrol or someother site and see their performance for the last 5 years and pick best performing one. But how can we trasnparently compare PMS?
Something related. Till some time ago, Porinju, the PMS manager from here in kerala, was on a PR blitzkrieg claiming xyz% returns. He portrayed himself as the doyen of risk taking, investing in lesser known small caps. And he made a lot more money when the market was rising. But he lost heavily recently (-50% difference vs nifty).
Untitled Page (NB: I dont know if this is the latest / actual return, or some fancy accounting has been done for marketing. Also if this is some ādefaultā portfolio. And there are other portfolios on steroids for clients who are comfortable with higher risks.)
āOnly when the tide goes out do you discover whoās been swimming naked.ā
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Each PMS uploads their monthly performance along with customer / investor no & funds being manged by PMS. We can monitor their performance before making a decision. Its quite obvious that they share return details for model portfolio & it shouldnāt be understood that each investor has received similar return in particular time frame.
https://www.sebi.gov.in/sebiweb/other/OtherAction.do?doPmr=yes
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Yes, (1) Mutual fund performance is available in several websites for comparing performance over last 1,3,5 yearsā¦
(2) Even the stock holdings are updated each month end in all website such as morningstar.com
(3) But we donāt get such data readily for all the PMS schemes
(4) Once a while PMS performance comes in digital media or some websites:
One link for top 20 PMS performance in 2019 giving 15-30% return is given below:
https://www.google.com/amp/s/investoracademy.in/best-pms-in-india-portfolio-management-services/amp/
With an objective to protect investor interests, I find SEBI has a online Complaints Redressal system- SCORES. ( Link given below) . One can always seek assistance and also give feedback on companies/stocks, promoters of companies, Stock brokers, intermediary, AMC, PMS and so on. It is easy and any investor can easily register grievances if any with SEBI.
https://scores.gov.in/scores/Welcome.html
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Presentation by Saurabh Mukherjea, MD and CEO, Marcellus Investment Managers at Motilal Oswal Conference at Alternate (MOCA 2020). Speaks about how Asian Paints has been money making machine, doubling almost every three year, explains philosophy behind their two PMS Schemes ā āConsistent Compoundersā and āLittle Champsā
According to him philosophy behind the PMS.
- Look for Company with clean accounts
- Look for Company which allocates capital conservatively
- Look for Companies with Himalayan entry barrier
Lot of new learning.
Do Watch
Saurabh Mukherjea (Marcellus Investment Managers) at MOCA 2020
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While there are no doubts on Asian Paints being a great company, I wonder what gives people the courage to put completely incorrect information even on data which is public just to prove their point. I was really shocked by seeing the same in the video.
At 13:16 he says that Asian Paints doubles every 3 years, while if you look at their SALES CAGR over the past 12 years it is 14%, respectable still but doubling every 3 years and doubling every 5 years is a completely different story (over 15 years a company which doubles every 3 years is 4 times bigger than the company which doubles every 5 years). Same with the point on Nestle in the video - which is having sales CAGR of 10% over the past 13 years while he says that the same is doubling every 5 years (CAGR of 14%). (source: Screener.in)
After that, there is yet another stupid and wrong point - that the volatility of Asian Paints is similar to the Government of India Bond. Long term beta (measure for volatility all over the world) for Asian Paints is 0.728 and not close to Zero which is what Beta for GoI bonds are. I donāt know where he gets his data from. Of course, when the stock has only moved up in the recent few years, its volatility would be lower but thatās reversing the cause and effect.
And there is another blatant mis-representation at 16:51 - he says that last one and a half years business has doubled at Asian Paints, but if see last 6 quarters results of Asian Paints the average yoy sales growth is 12% - I donāt know how he concluded that the sales have doubled in last 6 quarters.
Then another blatant wrong data being mentioned at 28:58 - that Asian Paints P/E has remained the same - āaaj jo hai, bees saal pehle bhi wohi thiā - while I donāt have the data for 20 years readily available with me - a quick check on ratestar.in shows that in 2010 - Asian Paints was trading at 23 times while it is now trading at 66 times. So a large part of returns have come from PE re-rating (which has gone up 3 times). In the next decade would the company trade at 200 times earning to give similar return as the last decade is a big question that investors should answer.
I hope that people in the quest to make their offering look superior to others, donāt just become similar to promoters of the companies they are trying to avoid investing in.
A very important part to understand is that a combination of few things: a) all-round slow down in the economy including most of the core sectors, real estate etc, b) extreme risk averseness in behaviour of investors, bankers and industry and c) ample global liquidity with low-interest rates have pushed prices of certain stocks like Asian Paints in the never-seen-before type of stratosphere while pushing a lot of other stocks into high value buy zones. This is a cycle and will also change (as all cycles do). Trees donāt grow to sky and valuations are the law of gravity in the world of investments. It is easy to make fun of Buffett and Klarman who have proven their investing merit over decades versus a track record of maybe 1-2 years with far lesser money to manage but very difficult to replicate even 2/3rd of their performance over the really long term. In the markets, there are no cinches.
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By itself buying resilient stocks has worked well in India, nothing wrong with it. I guess the issue here is that of logical inconsistency with the gyan that is being dished out. But then narratives work best in sales, logic does not work that well. If they can run this approach consistently across cycles, they will do well. As long as the performance supports, money managers can get away with BS and sometimes with murder too
The more I see markets and fund managers, the more I am convinced that most of them are guilty of trend extrapolation. For a while (which can last some years) because the trend gets reinforced their world view too gets reinforced and people buy into the narrative since performance supports.
Someone saying āinvest in companies with so called chor promotersā at the height of his bull run - his statement was obviously misquoted and taken out of context but the very fact that most fund managers in India would not dream of saying it even if drunk shows the hubris that can build up when stock prices go your way for a while. No one is immune to this, at best one can be self aware and regulate this to some extent but one cannot be immune to this.
To me the bigger surprise was when they exited Marico saying the company will likely not grow profits at 18-20%, who would even assume that Marico can grow at such rates over the medium term? Once again the answer is simple extrapolation. On a 10 year basis the company does show a PAT growth in excess of 16%. The entire thesis appears to be that of buying stocks that have been very resilient and then back fitting the narrative to justify that decision. Hence buy Divis Labs which has been very resilient while dumping Marico which has taken a beating. They need to be this way going by the structure of the fund - with 13 stocks in the portfolio they can afford 2-3 sub optimal investments at most.
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