Bespoke wealth management solutions: Here's what is driving the surge
As India sees a rise in the number of billionaires, the demand for
bespoke wealth management solutions for high net-worth individuals—in
the form of portfolio management services—has also gone up Did you
know that the billionaire capital of Asia also minted the highest
number of new billionaires last year? And, according to the 2024 Hurun
Global Rich List, it’s not Beijing, Shanghai, Dubai, or Hong Kong. It
is, in fact, Mumbai. For the first time in recent history, Mumbai has
pipped Beijing to the top spot—India’s financial capital is home to 92
billionaires with 27 new entrants, higher than Beijing’s 91
billionaires, with six new additions. More importantly, India added a
record 84 billionaires—in sharp contrast to China, which saw the number
dip by 155—in a single year. Only the US, with 109 new additions, minted
more billionaires last year.With the number of wealthy individuals
rising in the country, it comes as no surprise that the demand for
professional money managers for the well-heeled has also gone up. While
mutual funds (MFs) have become the go-to investment product for retail
investors, for wealthy investors—known as high net-worth individuals or
HNIs in market parlance—have found their panacea in portfolio management
services or PMS.Simply put, PMS refers to a fund management firm where a
fund manager manages a portfolio of stocks—typically between 20 and
30—as part of a scheme that could be designed around themes like value
investing, growth stocks or entrepreneurship, among other things. The
minimum ticket size for a PMS scheme is Rs 50 lakh. The growing demand
for PMS is corroborated by the fact that the total assets under
management (AUM) of the sector has more than doubled in the last five
years, growing to Rs 32.22 lakh crore as of January 2024 from Rs 15.40
lakh crore in January 2019. In fact, the number of portfolio managers
has more than doubled in the last seven to eight years to 400-plus.