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KARVY

PORTFOLIO MANAGEMENT
SERVICES

February 10 KARVY STOCK BROKING LTD


Why Portfolio Management?
PMS gives client access to an institutional process
of money management

 Wealth creation based on disciplined investment


process forms the crux of PMS

 Effective diversification helps reduce portfolio


volatility and enhances risk-adjusted returns
over long term

 PMS gives investor direct ownership of the


individual securities in the portfolio

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Key Features

 Minimum Investment: Rs 5 Lacs

 Additional investment: multiples of Rs 50,000

 Acceptable in : Shares or Cheque

 Surplus to be invested in Liquid Funds

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Energetic Plan
Strategy
 40:60 ratio large cap : mid cap

 No of stocks to be invested in: 15

 Short to medium-term investing

 Adequate diversification mitigating risks

 Maintain reasonable liquidity for unanticipated


investment opportunities

 Investment Horizon: 12 Months

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Fees Structure

Management Fees 2.5% p.a


Hurdle Rate 20% p.a.
Profit sharing 20% of return above the hurdle rate
Brokerage charges 0.5% for all transactions at actual

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Other Charges
 Withdrawal earlier than 12 months, charge
of 2.5% levied on the funds or securities
withdrawn on full year basis + hurdle rate
on Pro rata basis

 Other account opening, handling, incidental


charges/fees/duties/ taxes & custodial
charges will be borne by the client

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Profit Sharing: Illustration
OPENING NAV 500,000
CLOSING NAV 700,000
PROFIT AMOUNT 200,000
HURDLE RATE % (on opening NAV) 20%
HURDLE AMOUNT 100,000
PROFIT BEYOND HURDLE RATE 100,000
KARVY'S PROFIT SHARING % 20%
KARVY'S SHARE OF PROFITS 20,000

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Client Update

Investors will receive:

 Quarterly account performance statement

 Monthly Bank Statement

 Audited Financial Statement at the end


of each year

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About Us…
 Sebi registered portfolio manager

 Fund manager ably supported by the


research dept consisting of 20 + research
analysts

 Karvy Research rated in Asia Money

 Investment Committee acts as a facilitator


for the investment related decision process

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Investment Committee
Five member committee

 Ambareesh Baliga : Vice President – Equities

 Gopichand: Vice President - Karvy Stock Broking Ltd

 Hemindra Hazari: Head-Research

 Subramaniam: Head-Institutional Sales

 Ashish Kapoor: PMS

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Investment Philosophy
 Investment philosophy guided by two doctrines:
 Capital Preservation
 Optimising Gains

 Achieved by Stringent Research Process


 Stock Selection Process: Focus on -
 Business
 Management
 Valuation

 Diversified across sectors and stocks with no more than


 20% in any one sector and
 10% in any one stock

 Maximum number of stocks held will be 15

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Investment Foundation

3.Portfolio Creation •4. Portfolio Balancing


•Focus on: Portfolio Objectives
•Stock Selection •Strategic shift-Large Vs Mid cap
•Sectoral Composition •Fluctuating Cash levels
•Diversification

2.Stock Selection 5. Risk Management


•Business Quality •Adherence to diversification
•Management /exposure norms
•Valuations •Cash levels
•Keeping off low volume stocks

1.Sector Selection
•Government Policies
•Economic / Industry Data
•Capex Trends

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Steps to Stock Selection

7.Portfolio action
6.Weekly review by Investment Committee

5.Determination of entry & exit points

4.Feedback to investment committee

3.Management Interaction

2.Population screening

1.Sector Identification

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Important Information
Risk factors :
Equities as an asset class carry a higher risk in comparison to debt. While
risk cannot be totally eliminated, it can be mitigated through a well-
designed investment strategy. The Karvy Stock Broking Ltd Portfolios seek
to mitigate risk and deliver superior returns through research-based
investing. However, this objective may not be fully achieved due to various
reasons such as unfavourable market movements, misjudgment by portfolio
manager, adverse political or economic developments etc.

Disclaimer :
Any information contained in this material shall not be deemed to
constitute an advice, an offer to sell/purchase or as an invitation or
solicitation to do for security of any entity and further Karvy Stock
Broking Ltd and its employees/directors shall not be liable for any loss,
damage, liability whatsoever for any direct or indirect loss arising from the
use of this information. Recipients of this information should exercise due
care and caution and read the offer document (if necessary obtaining the
advice of finance/other professionals) prior to taking any decision on the
basis of this information.

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For more information
Call: 022-22895000
Email: pms@karvy.com
Visit us at: www.karvy.com

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