Many PMS companies, including the big ones are not complying with SEBI’s directives on disclosure of performance data. As usual, investors bear the brunt of the poor disclosure in a disclosure-based regime

Moneylife Digital Team

There are 253 portfolio management services (PMS) companies registered with the Securities and Exchange Board of India. According to circular issued by Securities and Exchange Board of India (SEBI) in 2010, they have to upload the disclosure document online.

The SEBI circular IMD/DF/16/2010, dated 2 November 2010, clearly says, “To ensure compliance with Regulation 14(2)(b)(iv) of SEBI (Portfolio Managers) Regulations, 1993, portfolio managers shall disclose the performance of portfolios grouped by investment category for the past three years as per the enclosed prescribed tabular format. Portfolio Managers shall also ensure that the disclosure document is given to all clients along with the account opening form at least two days in advance of signing the agreement. In order to ensure that the clients have access to updated information about the portfolio manager, portfolio managers shall place the latest disclosure document on their website, wherever possible”

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