Portfolio Management

Portfolio management refers to managing fund of an individual/ entity under the expert guidance of portfolio managers. In a layman’s language, the art of managing ones investment is called as portfolio management.

The customers from different walks of life are found to have done investment in the capital market by way of investing in various securities that has different yield curves. However, in the absence of complete know how of the market and also due to engagement in their own business activities, the overall return on their investment may not have been in line with actual potential. Therefore, Laxmi Capital, by way of offering various services such as Value Portfolio, Growth Portfolio, etc. can step in to their shoes and offer better return in their portfolio either by taking over their existing portfolio or by way of creating new portfolio with the team of experts of the stock market. This way, we try to free the customers up from their day to day engagement in such activities.

Laxmi Capital provides portfolio administration and portfolio management services with two broad services: Discretionary Portfolio Management Services and Non- discretionary Portfolio Management Services.

1.    Discretionary Portfolio Management Service:

The Discretionary Portfolio Management service is a platform where a client allows managing the portion of their investments to the company. The portfolio manager individually and independently manages the funds of each client in accordance with the needs of the client.

 With the alignment of individual investor's objective, the company helps in managing the assets of the clients. LxC provides four types of discretionary portfolio management services.

1.1 Value Portfolio:

Value portfolio comprises of stocks that are currently underpriced relative to their Earning per Share (EPS) andBook Value per Share (BVPS). Hence, value stocks will have low P/E and P/B ratios compared to other stocks. Earnings of companies that are categorized as value stocks are temporarily depressed; as a result, investors punish these stocks and price fall below the fair value. The rationale for value investing is that because earnings of these companies are only temporarily depressed and will again revert back to the mean, there is potential to capture price appreciation.

Minimum Time Horizon: 2 years

1.2 Growth Portfolio:

Growth portfolio comprises of stocks of companies that have higher future earning potential. The rationale for growth investing is that higher expected earnings growth will drive the stock price even higher. Because growth stocks’ price rises rapidly as long as earnings potential is realized, even clients with short investment horizon can invest in growth portfolio.

Minimum Amount of the scheme: NPR 500,000.00

Minimum Time Horizon: 2 years

1.3 Small/Mid Cap Portfolio:

Small Cap/Mid Cap portfolio comprises of stocks of companies that are smaller or average in nature in terms of market capitalization. Because these companies are relatively small and unknown, the potential returns are high because of two reasons: first, as they are small and relatively unknown their price will increase as they grow and expand, and second, because of low price, even a small increment in price will lead to higher return. However, the risks involved in these small companies are also high as they are often in their initial stage of business.

Minimum Time Horizon: 2 years

1.4 Large Cap Portfolio:

Large cap portfolio comprises of stocks of companies with large market capitalization. These companies are well known to investors and have been around for a long time. Hence, the risk involved with these large cap stocks is less compared to small cap stocks. However, because many investors hold these large cap stocks and these stocks are widely followed, they are usually fairly priced.

Minimum Investment Horizon: Negotiable

 

2.   Non-Discretionary Portfolio Management Service:

In non-discretionary portfolio management services, the portfolio manager manages the funds in accordance with the directions of the client. The portfolio manager cannot make buy-sell decisions at his own discretion; he has to refer to the client for every transaction. The choice as well as the timings of the investment decisions rest solely with the Investor. However the execution of trade is done by the portfolio manager

Laxmi Capital also provides Management of existing portfolio and different advisory services to clients.

 

3.   Portfolio Administrative Service:

Portfolio Administrative Service is a service where portfolio administrator- LxC provides clerical assistance related to their stock holding on client’s portfolio. Portfolio administration provides services like IPO/FPO subscription, right share subscription; bonus share collection and dematerialization (demat) of shares with fixed annual charge.