The jury is out…. Portfolio Management Services (PMS) have outperformed Equity Mutual Funds (MF) by a huge margin!

If you had invested INR 50 lakhs each in the basket of Top 5 Equity Mutual Funds v/s in Top 5 Portfolio Management Services over the last 1,2,3,5, and 10 Years, where would you end up?

Check out the numbers below!

For high performance investing, which is better – Portfolio Management Services or Mutual Funds?

Charmi Shah
Content & Analysis,
PMS AIF WORLD

Wealth Management Industry is not designed to be Fair. There are hundreds of products and strategies that waste time and money. A strict discipline is required, and one must practice caution while investing. It is easy to socialize and sell, which is what most sales-driven wealth management companies do. But it is equally difficult to maintain insight and integrity, which is what drives us.

PMS AIF WORLD provides analytics & content backed quality investment services. It is easy to socialize and sell, which is what most sales-driven wealth management companies do. But it is equally difficult to maintain insight and integrity, which is what drives us. Our focus is Performance, and we are driven by meaningful analytics.

We are a new age Wealth Management Company. With us, investors make informed investment decisions.

Here we present a simple analysis to address some real questions asked by investors today – Where should you invest – Portfolio Management Services (PMS) or Mutual Funds (MF)?

While both are well regulated and credible structures meant to out-perform equity market indices, objective performance analysis conveys that it is the PMSs that have generated significantly higher alpha and so, are righty considered to be wealth-creating vehicles.

Which is better – Portfolio Management Services or Mutual Funds?

We have curated a detailed score card to analyse the performance of both. A comparison has been done between MFs and PMSs (data has been considered as of 30.09.2023 for both) and the infographics of the same are given below.

We followed 3 simple steps

Step 1: We filtered Top 5 PMSs  and Top 5 Mutual Funds (Open Ended, Regular Plans) in different time periods of 1 Year, 2 Years, 3 Years, 5 Years, and 10 Years from all the options available during these time periods; for all— Annualized Returns have been taken for period ending 30.09.2023.

Also, since 10Y is a good long term horizon, we have not bifurcated the comparison into different market cap categories for 10Y. Thus, for a 10-year period, the comparison has been done across all categories; but for 5Y, 3Y, 2Y, and 1Y comparisons, we bifurcated into Multi Cap comparison as well as Mid & Small Comparisons.

Step 2: To make it simpler, we compared Multi Cap PMSs with Multi/Flexi Cap MFs and we compared Mid & Small Cap PMSs with Mid & Small Cap MFs.

Step 3: We assumed investing INR 2.5 crores in equal weights (i.e. INR 50 lakhs each) in Top 5 PMSs & investing INR 2.5 crores in equal weights (i.e. INR 50 lakhs each) in Top 5 MFs during these time periods and arrived at the following results.

10Y Returns Comparison – Across All Categories

TOP 5 PMSs- 10Y Returns (Across all categories)
Scheme Name   AuM (Cr)  Annualized Returns
Aequitas Investment India Opportunities Product 2726.10 38.38%
Master Trust India Growth Strategy 521.52 32.53%
Nine Rivers capital Aurum Small Cap Opportunities 458.00 32.15%
SageOne Investment Core Portfolio 2750.00 27.25%
AccuraCap PicoPower 629.64 26.32%
TOP 5 MFs- 10Y Returns (Across all categories)
Scheme Name   AuM (Cr)  Annualized Returns
Nippon India Small Cap Fund        37,374.40 29.69%
SBI Small Cap Fund – Regular Plan        21,319.60 27.15%
DSP Small Cap Fund – Regular Plan        12,097.83 25.81%
Mirae Asset Emerging Bluechip Fund        29,024.00 24.59%
Kotak Emerging Equity Fund        33,918.27 23.88%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2013, rather than in the top 5 MFs, over a period of 10 years, one would have generated Rs 14.11 Crs more.

5Y Returns Comparison – Multi Cap

TOP 5 PMSs- 5Y Returns (Multi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Sameeksha Capital Equity Fund 913.69 30.80%
Green Portfolio Special 240.75 29.63%
ValueQuest Platinum Scheme 659.65 29.36%
Globe Capital Value PMS 443.00 26.91%
Negen Capital Special Situations Fund 619.63 26.84%
TOP 5 MFs- 5Y Returns (Regular Plan, Multi/Flexi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Quant Active Fund          6,018.00 23.68%
Parag Parikh Flexi Cap Fund        42,784.56 19.16%
Mirae Asset Emerging Bluechip Fund        29,024.00 18.69%
Nippon India Multi Cap Fund        20,930.00 18.65%
HDFC Large and Mid Cap Fund        11,810.08 17.64%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2018, rather than in the top 5 MFs, over a period of 5 years, one would have generated Rs 2.72 Crs more.

5Y Returns Comparison – Mid & Small Cap

TOP 5 PMSs- 5Y Returns (Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Green Lantern Capital LLP Growth Fund      200.95 31.37%
Equirus Long Horizon Fund      896.73 29.60%
UNIFI APJ 20      538.59 28.05%
UNIFI Blended Fund-Rangoli    11,012.28 25.60%
Nine Rivers capital Aurum Small Cap Oppprtunities      458.00 25.59%
TOP 5 MFs- 5Y Returns (Regular Plan, Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Quant Small Cap Fund        9,089.12 29.46%
Nippon India Small Cap Fund      37,374.40 25.48%
Axis Small Cap Fund      16,175.33 24.85%
ICICI Prudential Smallcap Fund        6,054.27 24.41%
Kotak Small Cap Fund      12,439.62 23.97%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2018, rather than in the top 5 MFs, over a period of 5 years, one would have generated Rs 0.79 Crs more.

3Y Returns Comparison – Multi Cap

TOP 5 PMSs- 3Y Returns (Multi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Negen Capital Special Situations Fund 619.63 47.69%
INVASSET Growth Pro Max PMS 120.00 45.01%
Unique Strategic PMS 1113.75 43.92%
Buoyant Capital Opportunities Multi-cap 1393.00 42.72%
ValueQuest Platinum Scheme 659.65 40.78%
TOP 5 MFs- 3Y Returns (Regular Plan, Multi/Flexi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Nippon India Multi Cap Fund        20,930.00 37.85%
HDFC Flexi Cap Fund        39,794.33 33.20%
HDFC Large and Mid Cap Fund        11,810.08 31.72%
Quant Active Fund          6,018.00 31.56%
ICICI Prudential Large & Mid Cap Fund          9,177.04 31.19%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2020, rather than in the top 5 MFs, over a period of 3 years, one would have generated Rs 1.57 Crs more.

3Y Returns Comparison – Mid & Small Cap

TOP 5 PMSs- 3Y Returns (Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Counter Cyclical Diversified Long Term Value PMS           484.25 85.97%
Green Lantern Capital LLP Growth Fund      200.95 63.49%
Aequitas Investment India Opportunities Product    2,726.10 60.15%
Valentis Advisors Rising Star Opportunity Fund      651.00 47.11%
Roha Asset Managers Roha- Emerging Champions Portfolio      396.57 44.38%
TOP 5 MFs- 3Y Returns (Regular Plan, Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Quant Small Cap Fund        9,089.12 45.16%
Nippon India Small Cap Fund      37,374.40 42.76%
HSBC Small Cap Fund      11,650.11 40.70%
HDFC Small Cap Fund      23,251.04 39.83%
Tata Small Cap Fund        6,134.53 38.19%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2020, rather than in the top 5 MFs, over a period of 3 years, one would have generated Rs 3.49 Crs more.

2Y Returns Comparison – Multi Cap

TOP 5 PMSs- 2Y Returns (Multi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Unique Strategic PMS 1113.75 30.07%
INVAsset Growth Pro Max PMS 120.00 28.80%
Samvitti Capital Active Alpha Multicap 123.82 28.41%
Globe Capital Value PMS 443.00 22.71%
ICICI Prudential PMS Value Strategy 108.10 22.50%
TOP 5 MFs- 2Y Returns (Regular Plan, Multi/Flexi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Nippon India Multi Cap Fund        20,930.00 20.40%
HDFC Flexi Cap Fund        39,794.33 16.81%
HDFC Large and Mid Cap Fund        11,810.08 15.08%
Bandhan Core Equity Fund          2,944.80 14.05%
Kotak Multicap Fund          6,316.00 14.05%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2021, rather than in the top 5 MFs, over a period of 2 years, one would have generated Rs 0.63 Crs more.

2Y Returns Comparison – Mid & Small Cap

TOP 5 PMSs- 2Y Returns (Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Aequitas Investment India Opportunities Product    2,726.10 40.88%
Counter Cyclical Diversified Long Term Value PMS           484.25 40.40%
Green Lantern Capital LLP Growth Fund      200.95 36.15%
Molecule Ventures Growth PMS      282.32 31.62%
ithought VRDDHI PMS      262.00 28.30%
TOP 5 MFs- 2Y Returns (Regular Plan, Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Nippon India Small Cap Fund      37,374.40 22.95%
Motilal Oswal Midcap Fund        5,953.05 22.05%
Quant Mid Cap Fund        3,140.30 21.10%
HDFC Mid-Cap Opportunities Fund      48,686.00 20.36%
HSBC Small Cap Fund      11,650.11 20.09%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2021, rather than in the top 5 MFs, over a period of 2 years, one would have generated Rs 0.91 Crs more.

1Y Returns Comparison – Multi Cap

TOP 5 PMSs- 1Y Returns (Multi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Samvitti Capital Active Alpha Multicap 123.82 68.95%
Shepherd’s Hill Value Mango PMS 86.85 64.02%
INVASSET Growth Pro Max PMS 120.00 63.33%
Maximal Pathfinder Value PMS 82.24 57.39%
Unique Strategic PMS 1113.75 53.21%
TOP 5 MFs- 1Y Returns (Regular Plan, Multi/Flexi Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Motilal Oswal Large and Midcap Fund          2,337.62 30.06%
HDFC Multi Cap Fund          8,834.00 29.96%
Nippon India Multi Cap Fund        20,930.00 28.98%
Kotak Multicap Fund          6,316.00 28.70%
HDFC Large and Mid Cap Fund        11,810.08 27.26%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2022, rather than in the top 5 MFs, over a period of 1 year, one would have generated Rs 0.81 Crs more.

1Y Returns Comparison – Mid & Small Cap

TOP 5 PMSs- 1Y Returns (Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Aequitas Investment India Opportunities Product    2,726.10 82.09%
ithought VRDDHI PMS      262.00 59.72%
Green Lantern Capital LLP Growth Fund      200.95 58.70%
Green Portfolio Super 30        76.14 52.92%
Abakkus Asset Manager Emerging Opportunities Approach    1,422.00 50.90%
TOP 5 MFs- 1Y Returns (Regular Plan, Mid & Small Cap Fund)
Scheme Name  AuM (Cr) Annualized Returns
Quant Small Cap Fund        9,089.12 38.09%
HDFC Small Cap Fund      23,251.04 38.06%
Franklin India Smaller Companies Fund        9,719.31 36.43%
Nippon India Small Cap Fund      37,374.40 35.50%
HDFC Mid-Cap Opportunities Fund      48,686.00 34.94%

Conclusion: If one had invested Rs 2.5 Crs in these top 5 PMSs on 1st October 2022, rather than in the top 5 MFs, over a period of 1 year, one would have generated Rs 0.61 Crs more.

From the above results, it is clear that investing in PMSs has created more wealth for investors than investing in MFs.

This was simple. The difficult task starts from here on. And, that is –

  • How to select the potential Best 5 Portfolios for different periods of 3 to 5 years of future investments?
  • How to have the conviction to hold the best ones for the longer term?

And, this is best endeavored by our Analytics & Content backed approach.

Our proprietary analysis & content helps tackle the above 2 tasks. We are very selective, and we analyze PMS products across the 5 Ps – People, Philosophy, Performance, Portfolio, and Price with an aim to ascertain the Quality, Risk, and Consistency (QRC) attributes before suggesting the same to investors.

Holding on to the good equity investments requires high conviction in the portfolio at all points of time, else, one tends to exit early owing to the traps of emotions or impatience. With our proprietary content via fund manager videos, newsletters, and articles, we keep our clients updated, and this ensures our clients always make informed decisions.

We offer responsible, long-term quality investing. Our Philosophy is simple, but not easy –

Quality + High Conviction = Compounding.

For any queries related to your investment needs, book an appointment with our experts.

This analytics is an endeavor to compare MFs and PMSs objectively.


Please Note:

  • Min AUM taken for PMSs (3Y, 5Y, and 10Y Category) is Rs 200 Crs
  • Min AUM taken for PMSs (2Y Category) is Rs 100 Crs
  • Min AUM taken for PMSs (1Y Category) is Rs 75 Crs
  • Min AUM taken for MFs (5Y, and 10Y Category) is Rs 4000 Crs
  • Min AUM taken for MFs (3Y Category) is Rs 3000 Crs
  • Min AUM taken for MFs (2Y, and 1Y Category) is Rs 2000 Crs

Source: Respective PMS Companies’ Audited Factsheets for PMS Data and Value Research & Moneycontrol P2P Data for MF Data. Returns more than 1 year is CAGR. These are Point-to-Point returns till 30th September 2023. So, for 10Y, the period taken is 01st October 2013 to 30th September 2023 and likewise for others as well.


RISK DISCLAIMER: Investments are subject to market-related risks. This write up is meant for general information purposes and not to be construed as any recommendation or advice. The investor must make their own analysis and decision depending upon risk appetite. Only those investors who have an aptitude and attitude to risk should consider the space of Alternates (PMS & AIFs). Past Performance may or may not be sustained in the future and should not be used as a basis for comparison with other investments. Please read the disclosure documents carefully before investing. PMS & AIF products are market-linked and do not offer any guaranteed/assured returns. These are riskier investments, with a risk to principal amount as well. Thus, investors must make informed decisions. It is necessary to deep dive not only into the performance, but also into people, philosophy, portfolio, and price, before investing. We, at PMS AIF WORLD do such a detailed 5 P analysis.

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