NISM Certifications · NISM-Series-X-A: Investment Adviser (Level 1) · Portfolio Manager
Which statement best describes a non-discretionary portfolio management service as defined by SEBI?
In non-discretionary PMS the portfolio manager manages funds as per the client's directions, and every investment decision is taken only with the client's prior consent. Independent decisions describe discretionary PMS, and assured returns are not permitted.
- AThe portfolio manager decides investments independently, without client consent
- BThe portfolio manager manages funds only in mutual fund units
- CThe portfolio manager manages funds as per client's directions, with investment decisions taken only with the client's prior consentCorrect
- DThe portfolio manager guarantees a minimum return to the client
Explanation
In non-discretionary PMS, the manager advises and executes, but each investment decision needs the client's prior consent. Independent decision-making describes discretionary PMS. Guaranteeing returns is prohibited.
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