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Defining my industry: Portfolio Management Services in India

This topic has 1 expert reply and 1 member reply
ramsay_1901 Newbie | Next Rank: 10 Posts Default Avatar
Joined
19 Jul 2016
Posted:
7 messages

Defining my industry: Portfolio Management Services in India

Post Tue Jul 19, 2016 12:22 pm
Hi, I am from India and would like to know how would the US b-schools categorize the Portfolio Management Services industry in India.

Key features of the business:

Only investments size larger than $37k (large amount in Indian terms) are allowed. Threshold of eligible investors is the investment commitment and not networth or annual compensation of an individual.
Investments can be pooled together or separately managed
Managed through investor's account and not fund's account.
Markets are not mature enough so, only long-only public equity exposure allowed. No derivatives allowed.
Various styles or specific sector exposures are allowed.
Can take concentrated positions but leverage not allowed.
There is 2 & 20 system for compensation.
Portfolios can be discretionary or non-discretionary. Most of the portfolios are discretionary.
Usually very small teams like PM, assistant PM, Investment associate & analyst.
Require sell-side research experience of 1-2 years to get in.
Tougher to get in than usual investment management businesses.

Also, there are very few hedge funds, like 5-6 in the whole of India and are allowed to trade only in derivatives but there are many mutual funds (established & mature businesses here) in India. There just 250 PMS in India with just 5-10 being of the size I work at.

I am currently working as a research associate in a PMS. I will be applying for a US MBA in the future and wanted to know how would the b-schools categorize such a business? WIll they consider it as a HF, AM or a subtype of any? Will an experience in such a company be competitive enough for US MBA?

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Post Wed Jul 20, 2016 7:17 am
ramsay_1901 wrote:
Hi, I am from India and would like to know how would the US b-schools categorize the Portfolio Management Services industry in India.
Hi @ramsay 1901, Thanks for reaching out! I think broadly speaking your work experience will present as someone with experience in portfolio management and if you say that your goal is to expand your knowledge within this field you will have credibility to make that statement. The admissions committee is not going to classify the business that you worked in- they are going to read your essays and gather from the interview the depth of your knowledge and accomplishments in your work. From what you describe here, you sound well-versed in understanding the investment climate in India and you can stress that as something you would bring to the programs that interest you. I think your work experience will stand out in the pool from India because fewer have the experience you describe here. Adcoms will also want to see your grades and your GMAT and the school you attended and if all those present as well as what you describe here, I think you have the makings of a solid application. You might enjoy looking at programs where you can manage funds yourself to gain experience:

Here are some program links you might find useful:

http://www.owen.vanderbilt.edu/programs/mba/hands-on-experience.cfm
http://www.kenan-flagler.unc.edu/programs/mba/experiential-opportunities/student-managed-funds
http://clubs.wharton.upenn.edu/wimf/resources.htm
Keyhttp://www.chicagoboothsmif.com/about.htm features of the business:
https://www.gsb.stanford.edu/faculty-research/faculty/kevin-mak

As you can see- there are many of these experiential learning opportunities out there- and from what I see in your background- you could add value at many MBA programs if you package yourself in the best possible light. If you want to learn more about how admissions consultants can help you do that, we'd be glad to give you a free consult from our StratusPrep.com site!
Only investments size larger than $37k (large amount in Indian terms) are allowed. Threshold of eligible investors is the investment commitment and not networth or annual compensation of an individual.
Investments can be pooled together or separately managed
Managed through investor's account and not fund's account.
Markets are not mature enough so, only long-only public equity exposure allowed. No derivatives allowed.
Various styles or specific sector exposures are allowed.
Can take concentrated positions but leverage not allowed.
There is 2 & 20 system for compensation.
Portfolios can be discretionary or non-discretionary. Most of the portfolios are discretionary.
Usually very small teams like PM, assistant PM, Investment associate & analyst.
Require sell-side research experience of 1-2 years to get in.
Tougher to get in than usual investment management businesses.

Also, there are very few hedge funds, like 5-6 in the whole of India and are allowed to trade only in derivatives but there are many mutual funds (established & mature businesses here) in India. There just 250 PMS in India with just 5-10 being of the size I work at.

I am currently working as a research associate in a PMS. I will be applying for a US MBA in the future and wanted to know how would the b-schools categorize such a business? WIll they consider it as a HF, AM or a subtype of any? Will an experience in such a company be competitive enough for US MBA?

Thanked by: ramsay_1901
ramsay_1901 Newbie | Next Rank: 10 Posts Default Avatar
Joined
19 Jul 2016
Posted:
7 messages
Post Wed Jul 20, 2016 8:41 am
Thank you Ms. Donna. I appreciate you providing me a detailed response to my query and for sharing the important links.

I have just started out my career directly in the buy-side and I plan to work for the next 5 years before I start my MBA. Over the next few years, I will try taking a leadership role in both my professional & non-professional life and make sure my GMAT scores are on par with/above the class average. Also, I have completed my undergraduation in the US from a top ChemE program and have passed all the levels of CFA in one attempt. I look forward to continuously improving my profile to make sure I get into the top programs for investment management.

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