Portfolio Manager Registration With SEBI
Who Are Portfolio Managers?
Portfolio managers are also termed asset managers, investment councilors, or investment managers. There are various benefits associated with hiring a portfolio manager but to become one, an applicant is required to get registers with the SEBI. As per norms of SEBI, portfolio manager registration is regulated by SEBI regulations of 1993 for the same. The norms state that any person who is under the arrangement in form of a contract or advises firms or undertakes administration of funds of the clients on their behalf should register as a portfolio manager from SEBI.
In other words, one can be called a portfolio manager if he or she makes investment decisions or conducts related activities on behalf of an investor or a corporate client. In the following sections, we will understand the benefits of becoming a portfolio manager, its eligibility criteria for registration, and the related registration procedure.
Benefits of Hiring a Portfolio Manager for Companies
Following are the benefits of hiring a portfolio manager for your business:
Personalized management of investment portfolios
Portfolio managers can act on behalf of the investor to conduct investment activities personally and is responsible for the management of all the assets and securities of clients.
Nominal Charges
Portfolio managers usually charge a percentage of the assets they manage as their fee. The transparent fee charged by the Mangers is lower than the retail management or costs related to distribution. This makes hiring a Portfolio manager even more fruitful.
Transfer of responsibility
The responsibility of managing huge securities or investments could prove a lot for the investor. It takes a significant amount of time and energy. Also, portfolio managers are bound by fiduciary responsibility to act with honesty and in good faith while keeping the interests of the client in mind. The hassle-free approach and time savings available to corporate clients are quite significant compared to the fee charged by them.
Eligibility Criteria for Becoming a Portfolio Manager
To apply for a Portfolio Manager license from SEBI, one needs to get themselves registered from the authority. The applicant must send an application for registration to the SEBI with the requisite documents. After this, the board scrutinizes the application on the following criteria to decide whether the applicant is eligible for registration or not.
1. Experience of a minimum of 10 years in activities related to the securities market, stockbroker, portfolio manager, or fund manager.
2. CFA institute’s CFA charter.
3. A professional qualification from a recognized institution or university in the field of accountancy, law, finance, and business management.
1. If an earlier application from the same applicant was rejected by the board.
2. If the board has conducted any disciplinary action against any person who has a direct or indirect connection with the applicant.
3. If the PO or any other administrative officer of the applicant organisation is involved in any litigation.
4. Convicted or found guilty of any financial offense or anything involving moral turpitude.
Procedure for Registration as Portfolio Manager from SEBI
Documents Required For Portfolio Manager Registration
The following documents are required for Depository Participant SEBI Registration:
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The applicant must be a corporate body with the administrator having relevant experience and qualifications. The applicant organisation must possess the necessary infrastructure to support the activities of the portfolio manager. The infrastructure includes necessary equipment, office space, and essential human resources.
Portfolio managers can act on behalf of the investor to conduct investment activities personally and is responsible for the management of all the assets and securities of clients. Portfolio managers usually charge a percentage of the assets they manage as their fee. The transparent fee charged by the Mangers is lower than the retail management or costs related to distribution. This makes hiring a Portfolio manager even more fruitful. The hassle-free approach and time savings available to corporate clients are quite significant compared to the fee charged by them.
Portfolio managers are also termed asset managers, investment councilors, or investment managers. The SEBI norms state that any person who is under the arrangement in form of a contract or advises firms or undertakes administration of funds of the clients on their behalf should register as a portfolio manager from SEBI.