Reaching the ₹1 crore investment milestone is commendable, but maintaining and growing this wealth demands strategic diversification beyond mutual funds. Yet, many investors hesitate to explore Portfolio Management Services (PMS) and Alternative Investment Funds (AIFs) , specifically tailored for High Net-Worth Individuals (HNIs).
Consider this scenario:
● Amit and Ravi each have ₹5 crore in investable assets.
● Amit invests solely in stock mutual funds, while Ravi diversifies across Mutual Funds, PMS, and AIFs.
● During a 20% market correction, Amit’s equity-heavy portfolio sees significant losses.
● Ravi, however, is shielded by his diversified investments in conservative stocks (PMS) and private equity/structured credit (AIFs), greatly minimizing the downturn.
The lesson? Strategic diversification into PMS and AIFs can significantly enhance capital
protection and improve risk-adjusted returns.
A Balanced Portfolio Recommendation (for ₹5 crore portfolio):
● Mutual Funds: 30%
● PMS: 40%
● AIFs: 30%
Mutual funds offer a strong foundation, but PMS provides personalized solutions and enhanced downside protection, while AIFs open doors to alternative, high-growth opportunities typically inaccessible through traditional investments.
The bottom line: Diversification isn’t just prudent—it’s essential for sustained wealth creation and protection, especially for HNIs seeking robust, long-term growth.
What’s your experience or perspective on diversification strategies beyond mutual funds? I’d love to hear your insights!
#Diversification #PMS #AIF #WealthManagement #InvestmentStrategies #HNIs #FinancialPlanning
—
CA. Prakhar Goyal
Investor | Chartered Accountant | Partner, Satyanarayan Goyal & Co.
