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Regulation Of Portfolio Management Services Regulation of Portfolio Management Services (SEBI and Portfolio Management)

DEFINITION:
PORTFOLIO : As per definition of SEBI Portfolio means a collection of securities owned by an investor. It represents the total holdings of securities belonging to any person". PORTFOLIO MANAGEMENT: The process of managing the assets of a mutual fund, including choosing and monitoring appropriate investments and allocating funds accordingly.

INTRODUCTION
As per definition of SEBI Portfolio means a collection of securities owned by an investor. It represents the total holdings of securities belonging to any person". It comprises of different types of assets and securities In finance, a portfolio is an appropriate mix or collection of investments held by an institution or an individual. Holding a portfolio is a part of an investment and risk-limiting strategy called diversification. By owning several assets, certain types of risk (in particular specific risk) can be reduced. The assets in the portfolio could include stocks, bonds, options, warrants, gold certificates, real estate, futures contracts, production facilities, or any other item that is expected to retain its value. In building up an investment portfolio a financial institution will typically conduct its own investment analysis, whilst a private individual may make use of the services of a financial advisor or a financial institution which offers portfolio management services. Portfolio management refers to the management or administration of a portfolio of securities to protect and enhance the value of the underlying investment. It is the management of various securities (shares, bonds etc) and other assets (e.g. real estate), to meet specified investment goals for the benefit of the investors. It helps to reduce risk without sacrificing returns. It involves a proper investment decision with regards to what to buy and sell. It involves proper money management. It is also known as Investment Management

Regulation Of Portfolio Management Services


Portfolio management involves deciding what assets to include in the portfolio, given the goals of the portfolio owner and changing economic conditions. Selection involves deciding what assets to purchase, how many to purchase, when to purchase them, and what assets to divest. These decisions always involve some sort of performance measurement, most typically expected return on the portfolio, and the risk associated with this return (i.e. the standard deviation of the return). Typically the expected return from portfolios of different asset bundles is compared. The art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against performance . Portfolio management is all about strengths, weaknesses, opportunities and threats in the choice of debt vs. equity, domestic vs. international, growth vs. safety, and many other tradeoffs encountered in the attempt to maximize return at a given appetite for risk. Portfolio management involves maintaining a proper combination of securities which comprise the investors portfolio in a manner that they give maximum return with minimum risk. This requires framing of proper investment policy. Investment policy means formation of guidelines for allocation of available funds among the various types of securities including variation in such proportion under changing environment. This requires proper mix between different securities in a manner that it can maximize the return with minimum risk to the investor. Broadly speaking investors are those individuals who save money and invest in the market in order to get return over it. They are not much educated, expert and they do not have time to carry out detailed study. They have their business life, family life as well as social life and the time left out is very much limited to study for investment purpose. On the other hand institutional investors are companies, mutual funds, banks and insurance company who have surplus fund which needs to be invested profitably. These investors have time and resources to carry out detailed research for the purpose of investing.

Regulation Of Portfolio Management Services


PORTFOLIO MANAGEMENT SERVICES
In todays complex financial market, every individual investor has their own specific financial needs that are based on their risk appetite and financial goals. But regardless of this, every investor wants to maximize his return on investments with capital protection. This requires management of investments professionally to achieve specific investment objectives, relieving investor from the day-to-day administrative hassles of investments. This is where the Portfolio Management Services (PMS) comes in picture. In India, all major brokerage firms, asset management companies and independent experts provide portfolio management services to clients. It is the art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against performance. In other words, Portfolio Management Services (PMS) is a specialized & customized service that offers a range of specialized investment strategies to capitalize on the opportunities in the market. Though, PMS is managed by a professional portfolio managers, it has potential to address the personal preferences tailored into the investment portfolio giving the freedom and flexibility required for achieving the financial goals. This is typically a high-end product meant for high net-worth individuals (HNIs) because it needs some significant minimum investment. Today, the financial market is increasingly complex and managing your own portfolio will take up a lot of your time and effort. There are situations when you dont have time or knowledge to explore the best investment alternatives in the market. This is a common problem faced by many wannabe investors like you. At this juncture, portfolio management services can help you get out of this dilemma. So you can simply assign your investments to portfolio management services who will report to you regularly on your portfolio performance. Dont feel lost in this complex world of investments. Let the experts do their job. But why should you opt for PMS? Here are a few aspects on which portfolio managers say they score on top like:Balanced Portfolio: Professional research and advice will help you with information on the best investment options and ideas for your portfolio.

Maximum Returns, Minimum Risks: Portfolio management services assure you of the best downside protection for your portfolio. You will benefit with practical financial advice that can help convert all paper gains into real profits in the shortest time. Adjust Your Portfolio To Market Trends: When you avail of portfolio management services, you enjoy greater freedom and flexibility to diversify your investments.

Regulation Of Portfolio Management Services


Personalized Advice: Get investment advice and strategies from expert Fund Managers. Professional Management: Money management services that work for you. Continuous Monitoring: You are informed about your investment decisions. Hassle Free Operation: High standards of service and complete portfolio transparency. Greater control: You have greater control over the asset allocation in PMS. Here the portfolio can be customized to suit your risk-return profile. Transparency: PMS provides comprehensive communications and performance reporting that will give investors a complete picture regarding the securities held on his behalf. Portfolio Management Services account is an investment portfolio in Stocks, Debt and fixed income products managed by a professional money manager, that can potentially be tailored to meet specific investment objectives. When you invest in PMS, you own individual securities unlike a mutual fund investor, who owns units of the entire fund. You have the freedom and flexibility to tailor your portfolio to address personal preferences and financial goals. Although portfolio managers may oversee hundreds of portfolios, your account may be unique. As per SEBI guidelines, only those entities who are registered with SEBI for providing PMS services can offer PMS to clients. There is no separate certification required for selling any PMS product. So this is case where mis-selling can happen. As per the SEBI guidelines, the minimum investment required to open a PMS account is Rs. 5 Lacs. However, different providers have different minimum balance requirements for different products. For Eg Birla AMC PMS is having min amount requirement of Rs. 25 lacs for a product. Similarly HSBC AMC is having minimum requirement of 50 lacs for their PMS and Reliance is having min requirement of Rs. 1 Crore. In India Portfolio Management Services are also provided by equity broking firms & wealth management services.

Regulation Of Portfolio Management Services


BENEFIT FROM PORTFOLIO MANAGEMENT SERVICE An Investment Relationship Manager will ensure that you receive all the services related to your investment needs. A dedicated website and a customer services desk allows you to keep a tab on your portfolios performance. Your portfolio of investments in stock market is tailored after a thorough research backed by the expertise from the Kotak Securities Research team. An experienced team of portfolio managers ensure your portfolio is tracked, monitored and optimised at all times.

The personalised services also translates into zero paper work and all your financial statements will be e-mailed.

TYPES OF PORTFOLIO MANAGEMENT SERVICE

1. DISCRETIONARY PMS
The following are indicative types of costs and expenses for clients availing the discretionary Portfolio Management services of Credit Suisse. The exact basis of charge relating to each of the services shall be received by your Portfolio Manager.Management fees relate to the Portfolio Management Services offered to clients. The fee can be in the form of a recurring charge based on the asset size held within the Portfolio or in the nature of a variable charge that is linked to portfolio returns achieved (based on the High Watermark principle issued in SEBI circular dated October 05, 2010) or on the transaction value or a combination of all or any of these subject to minimum fees as agreed with client. Management fees shall not exceed 4% each year of the Client's Portfolio except where the management fees are in the nature of a variable charge (performance-based). Where the management fees is a percentage of the quantum of funds managed, the Portfolio Manager may charge management fees based on the average value of portfolio (calculated on a daily/ weekly/ monthly or quarterly basis). Management fees can vary from client to client.

Regulation Of Portfolio Management Services


Any brokerage charges (not exceeding 2%),, third-party charges and other charges like service charge, stamp duty, securities transaction tax ("STT"), transaction costs (not exceeding 2% or Rs 500/per transaction whichever is higher), custody costs (not exceeding 0.15% per annum), turnover tax, exit and entry loads on the purchase and sale of shares, stocks, bonds, debt, deposits, units and other financial instruments will be charged separately to the client.

2. NON-DISCRETIONARY PMS
The following are indicative types of costs and expenses for clients availing the nondiscretionary services of Credit Suisse. The exact basis of charge relating to each of the services shall be received by your Portfolio Manager. Management fees relate to the Portfolio Management Services offered to clients. The fee can be in the form of a recurring charge based on the asset size held within the Portfolio or in the nature of a variable charge that is linked to portfolio returns achieved (based on the High Watermark principle issued in SEBI circular dated October 05, 2010) or on the transaction value or a combination of all or any of these subject to minimum fees as agreed with client. Management fees shall not exceed 4% each year of the Client's Portfolio except where the management fees are in the nature of a variable charge (performance-based). Where the management fees is a percentage of the quantum of funds managed, the Portfolio Manager may charge management fees based on the average value of portfolio (calculated on a daily/ weekly/ monthly or quarterly basis). Management fees can vary from client to client. Any brokerage charges (not exceeding 2%), third-party charges and other charges like service charge, stamp duty, securities transaction tax ("STT"), transaction costs (not exceeding 2% or Rs 500/ per transaction whichever is higher) ,custody costs (not exceeding 0.15% per annum), turnover tax, exit and entry loads on the purchase and sale of shares, stocks, bonds, debt, deposits, units and other financial instruments will be charged separately to the client.

Regulation Of Portfolio Management Services


REFERRAL/ DISTRIBUTION FEES
The following referral/distribution fees are in addition to the above mentioned costs,expenses, fees and charges. From time to time, your Portfolio Manager may at your instruction, refer you over to external portfolio managers/ banks/financial intermediaries/any other entity (referred to hereafter as External Agents) for availing their services or subscribing to products issued by them. In such cases, your Portfolio Manager may enter into intermediary/referral agreements with such External Agents for which it may be entitled to receive referral fees/commissions and/or other monetary benefits, which may be equal to or less than 4% per annum of the aggregate investment amounts or the net asset value of the aggregate investments made by you (ie. for trailer fees model). The referral fees/commissions could be charged by way of upfront fees or trail fees format or a combination of upfront fees or trail fees format and shall be exclusive of any other additional fees, costs, charges levied by the External Agents. For certain investment products, trailer fees may be charged by the External Agents in advance, at the start of every calendar quarter instead. In all cases, service tax, security transaction tax and other statutory levies are charged as applicable. In the event where you choose profit sharing plans for your investments with external portfolio managers, the above fee arrangements may no longer be applicable and you will have to independently review your detailed profit sharing plans with the relevant external portfolio manager. In such cases, as a general guide, your Portfolio Manager may be entitled to up to 40% of the aggregate profit shared by you with the external agents. In the event you choose fixed plus profit sharing plan for your investments with external agents, then you could be charged by way of upfront fees, trailer fees and profit sharing fees. The fixed fees component entitlement in favor of your Portfolio Manager may be equal to or less than 4% per annum of the aggregate investment amounts or the net asset value of the aggregate investments made by you (i.e. for trailer fees model). The profit sharing component entitlement in favor of your Portfolio Manager may be up to 40% of the aggregate profit shared by you with the relevant external agents. All referrals by your Portfolio Manager to external agents and any subsequent investments into the financial products and services by you with the external portfolio managers/ External Agents / banks/financial intermediaries are conducted solely at your absolute discretion. Such referrals are not to be construed as a solicitation and/or an offer to buy or sell any security or other financial instrument and is not based on any legal, accounting and/or tax advice offered by your Portfolio Manager. You should consult with such advisor(s) as you consider necessary before making any investment decisions with any referred external agents. In respect of referrals for investments in mutual fund schemes, your portfolio manager may be entitled to receive distribution/referral fees up to 6% per annum.

Regulation Of Portfolio Management Services


REGULATION
Portfolio management is a dynamic process which involves the following steps: 1.Identification of objectives constraints and preference s of investor forn formulation of investment policy. 2.Develop and implement strategies in tune with investment policy formulated. It helps the selection of asset classes and securities in each class depending upon their risk return attributes. 3.Review and monitoring of the performance of the portfolio by continous overview of the market conditions and performance of the companies. 4.Evalution of the portfolio for the results to compare with targets and make some adjustments for the future. The securities market has grown tremendously. The number of financial institutions been growing. The FIIs have entered in Indian stock markets. The number of institutions has also been growing day by day. Therefore, the portfolio management has become a complex and responsible job which requires an in depth training and expertise. Therefore, the government of india set up the securities and exchanges board of india onm 12th April,1998. It deals with all matters relating to develpomenty and regulation of securities market and investor protection and to advise the government to all these matters. SEBI was given statutory power through an ordinance promulgated on 30th januaryu1993.the statutory powers and functions of SEBI were strengthened through the progumulated of the securities law ordinance on 25th January 1995 which was subsequently replaced by an act of parliament. In terms of this act, SEBI has been vested with regulatory powers over corporate in the issuance of capital and the transfer of securities. Thus, SEBI is for the protection of investor, regulation of stock exchanges and financial intermediaries and healthy growth of capital market. The highly infrignmed portfolio management services were placed under this regulation of SEBI since January 11,1993. This is the forth financial activity brought under SEBIs control aftyer stock broker, merchant banking and insider

Regulation Of Portfolio Management Services


SEBI Guidelines To Portfolio Management
The nature of portfolio management service shall be investment consultant. The portfolio manager shall not guarantee any return to his client. Clients funds will be kept in a separate bank account. The portfolio manager shall act as trustee of clients funds The portfolio manager can invest in money or capital market. Purchase and sale of securities will be at a prevailing market price.

Securities and Exchange Board of India (Portfolio Managers) Regulations, 1993 Date
07-Jan-1993 10-Feb-2012 11-Aug2008 30-Nov2006 07-Sep-2006 05-Jul-2006 27-May2004 22-Feb-2000 30-Sep-1999 [As Amended upto February 10, 2012] Securities and Exchanage Board of India ((Portfolio Managers)(Amendment) Regulations, 2012) Securities and Exchange Board of India (Portfolio Managers) (Amendment) Regulations, 2008 Securities And Exchange Board Of India (Portfolio Managers) (Third Amendment) Regulations, 2006 Securities And Exchange Board Of India (Portfolio Managers) (Second Amendment) Regulations, 2006 Securities And Exchange Board Of India (Portfolio Managers) (Amendment) Regulations, 2006 Securities And Exchange Board Of India (Portfolio Managers) (Amendment) Regulations, 2004 Securities and Exchange Board of India(Portfolio Managers) (Amendment) Regulations, 2000 Securities and Exchange Board of India (Portfolio Managers) (Amendment) Regulations 1999

Details
Securities and Exchange Board of India (Portfolio Managers) Regulations, 1993

Regulation Of Portfolio Management Services


SECURITIES AND EXCHANGE BOARD OF INDIA
(PORTFOLIO MANAGERS) REGULATIONS, 1993 CONTENTS CHAPTER I: PRELIMINARY 1. Short title and commencement 2. Definitions CHAPTER II: REGISTRATION OF PORTFOLIO MANAGERS 3. Registration as portfolio manager 3A. Application for grant of certificate 4. Application to conform to the requirements 5. Furnishing of further information, clarification, and personal representation 6. Consideration of application 6A. Criteria for fit and proper person 7. Capital adequacy requirement 8. Procedure for registration 9. Renewal of certificate 9A. Conditions of registration 10. Procedure where registration is not granted 11. Effect of refusal to grant certificate 12. Payment of fees, and the consequences of failure to pay fees CHAPTER III: GENERAL OBLIGATIONS AND RESPONSIBILITIES 13. Code of Conduct 14. Contract with clients and disclosures 15. General responsibilities of a portfolio manager

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16. Investment of clients' moneys and management of clients portfolio of securities 16A. Foreign institutional investors and sub-accounts availing portfolio management services 16B. Appointment of custodian 17. Maintenance of books of accounts, records, etc. 18. Submission of half-yearly results 19. Maintenance of books of accounts, records and other documents 20. Accounts and audit 21. Reports to be furnished to the client 22. Report on steps taken on Auditor's report 23. Disclosures to the Board 23A. Appointment of compliance officer Page 2 of 62

CHAPTER IV: INSPECTION AND DISCIPLINARY PROCEEDINGS


24. 25. 26. 27. 28. 29. Right of inspection by the Board Notice before inspection Obligations of Portfolio Manager on inspection Submission of report to the Board Action on inspection or investigation report Appointment of Auditor

CHAPTER V: PROCEDURE FOR ACTION IN CASE OF DEFAULT


30. Liability for action in case of default

31. Omitted by the Securities (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002]

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32. Omitted by the Securities (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002] 33. Omitted by the Securities (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002] 34. Omitted by the Securities (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002] 35. Omitted by the Securities (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002] 36. Omitted by the Securities (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002] 38. Omitted by the Securities (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002]

CHAPTER VI: MISCELLANEOUS


39. Power of the Board to issue clarification Forms

SCHEDULE I:

FORM A: Application for Grant of Certificate/Renewal of Certificate FORM B: FORM C: Certificate of Registration Details of Portfolio Manager

SCHEDULE II: Fees SCHEDULE III: Code of Conduct SCHEDULE IV: Contents of Agreement between the Portfolio Manager and his Clients SCHEDULE V: Disclosure Document

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UNDER REGULATION 14 OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (PORTFOLIO MANAGERS) REGULATIONS, 1993 This Disclosure Document (Document) has been filed with the Securities and Exchange Board of India (SEBI) along with the certificate in the prescribed format pursuant to regulation 14 of the Securities and Exchange Board of India (Portfolio Managers) Regulations, 1993 as amended till date (Regulations). The purpose of this document is to provide essential information about the Portfolio Management Services in a manner to assist and enable the clients in making an informed and considered decision in relation to engaging Credit Suisse Securities (India) Private Limited ( CS India) as a Portfolio Manager (Portfolio Manager). Information about the Portfolio Manager is provided on page 8 of this document. Clients should carefully read this entire document prior to making a decision to avail of the portfolio management services (as hereinafter defined). Clients are advised to retain this document for future reference. Any other relevant information may be provided upon request. Clients may also wish to seek further clarifications after the date of this document from the Portfolio Manager. The portfolio manager is permitted to provide Portfolio Management Services pursuant to its registration as a Portfolio Manager with SEBI under the regulations. The Portfolio Manager holds a valid registration, registration no. INP000002478, dated 11 January 2011. All intermediaries involved in providing the Portfolio Management Services are registered with SEBI as of the date of this document.

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CODE OF CONDUCT- PORTFOLIO MANAGER
1. A portfolio manager shall, in the conduct of his business, observe high standards of integrity and fairness in all his dealings with his clients and other portfolio managers. 2. The money received by a portfolio manager from a client for an investment purpose should be deployed by the portfolio manager as soon as possible for that purpose and money due and payable to a client should be paid forthwith. 3. A portfolio manager shall render at all times high standards of service, exercise due diligence, ensure proper care and exercise independent professional judgment. The portfolio manager shall either avoid any conflict of interest in his investment or disinvestment decision, or where any conflict of interest arises, ensure fair treatment to all his customers. He shall disclose to the clients, possible source of conflict of duties and interests, while providing unbiased services. A portfolio manager shall not place his interest above those of his clients. 4. A portfolio manager shall not make any statement or become privy to any act, practice or unfair competition, which is likely to be harmful to the interests of other portfolio managers or is likely to place such other portfolio managers in a disadvantageous position in relation to the portfolio manager himself, while competing for or executing any assignment. 5. A portfolio manager shall not make any exaggerated statement, whether oral or written, to the client either about the qualification or the capability to render certain services or his achievements in regard to

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services rendered to other clients. Page 49 of 62 6. At the time of entering into a contract, the portfolio manager shall obtain in writing from the client, his interest in various corporate bodies which enables him to obtain unpublished price-sensitive information of the body corporate. 7. A portfolio manager shall not disclose to any clients, or press any confidential information about his client, which has come to his knowledge. 8. The portfolio manager shall where necessary and in the interest of the client take adequate steps for registration of the transfer of the clients' securities and for claiming and receiving dividends, interest payments and other rights accruing to the client. He shall also take necessary action for conversion of securities and subscription/renunciation of/or rights in accordance with the clients' instruction. 9. A portfolio manager shall endeavor to (a) ensure that the investors are provided with true and adequate information without making any misguiding or exaggerated claims and are made aware of attendant risks before any investment decision is taken by them; (b) render the best possible advice to the client having regard to the client's needs and the environment, and his own professional skills; (c) ensure that all professional dealings are effected in a prompt, efficient and cost effective manner. 10. (1) A portfolio manager shall not be a party to (a) creation of false market in securities;

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(b) price rigging or manipulation of securities; (c) passing of price sensitive information to brokers, members of the stock exchanges and any other intermediaries in the capital Page 50 of 62 market or take any other action which is prejudicial to the interest of the investors. (2) No portfolio manager or any of its directors, partners or manager shall either on their respective accounts or through their associates or family members, relatives enter into any transaction in securities of companies on the basis of unpublished price sensitive information obtained by them during the course of any professional assignment. [11.(a) A portfolio manager or any his employees shall not render, directly or indirectly any investment advice about any security in the publicly accessible media, whether real-time or non-real-time, unless a disclosure of his long or short position in the said security has been made, while rendering such advice. (b) In case an employee of the portfolio manager is rendering such advice, he shall also disclose the interest of his dependent family members and the employer including their long or short position in the said security, while rendering such advice.]

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DISCLOSURE DOCUMENT
[Regulation 14] General instructions 1. This Disclosure Document is to be given to the prospective client along with the account opening form (as per Format I) at least two days in advance of signing of the agreement. 2. This Disclosure Document is to be filed with the Board before it is circulated or issued to any person and every six month thereafter or whenever any material changes are effected therein. 3. This model Disclosure Document enumerates the minimum disclosure requirements to be contained in the disclosure document. The portfolio manager may make any other disclosures, which in its opinion are material for the investor, provided that such information is a statement of fact and is not presented in an incomplete, inaccurate or misleading manner. It should also be ensured that inclusion of such information does not, by virtue of its nature or manner of presentation, hamper understanding of any information that is required to be included under the model disclosure document The model Disclosure Document specifies only the nature of the disclosures that should be contained under various heads in the disclosure document, and is not intended to describe the layout or language to be contained therein.

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SERVICES OFFERED
Discretionary portfolio management services to be rendered to a Client by the Portfolio Manager pursuant to the terms and conditions contained in the Discretionary Portfolio Management Services Agreement, where under the Portfolio Manager exercises absolute and unfettered discretion, with regards to the investment and management of the Assets of a Client. (b) Non-discretionary portfolio management services to be rendered to a Client by the Portfolio Manager pursuant to the terms and conditions contained in the NonDiscretionary Portfolio Management Services Agreement, where under the Portfolio Manager renders investment advise to a Client in relation to the investment and management of the Assets of such Client, and based on the instructions of the Client, the Portfolio Manager invests and manages the Assets of the Client. The Portfolio Manager may from time to time, at a Clients instruction, refer a Client over to external portfolio managers. For the avoidance of doubt, all such referrals by the Portfolio Manager to external portfolio managers and any subsequent investments into the financial products and services by a Client with the external portfolio managers are conducted solely at the Clients absolute discretion. Such referrals by the Portfolio Manager are not to be construed as a solicitation and/or an offer to buy or sell any security or other financial instrument and is not based on any legal, accounting and/or tax advice offered by the Portfolio Manager. The Client would also consult with such advisor(s) as the Client considers necessary before making any investment decisions with any referred external portfolio managers. (c) The Portfolio Manager shall purchase, sell or otherwise deal in Securities for and on behalf of the Client through its broker dealer division (details of registration of the same are as mentioned in Section III above), which shall be entitled to charge brokerage in respect of such transactions. The Portfolio Manager may also purchase Securities from time to time for and on behalf of the Client, which Securities may also be sold by the clients of the broker dealer division of the Portfolio Manager (as mentioned in Section III above). (d) The Portfolio Manager may execute orders and/or enter into transactions for investment in Securities for the issue of which the merchant banker division of CSSIPL may be acting as the lead manager, underwriter, merchant banker, advisor or other intermediary. The merchant banker division shall be entitled to receive commission, fees, or other consideration, from the issuer of Securities, for the services provided by it. (e) The Portfolio Manager may execute orders and/or enter into transactions in the units of mutual funds for and on behalf of the Client through its MFD division (details of registration of the same are as mentioned in Section III above), which shall be entitled to receive fees commission or other consideration from the mutual funds for the services provided by it. (f) The Portfolio Manager may execute orders and/or enter into transactions in the financial products other than units of mutual funds for and on behalf of the Client through its OPD division (details of the same are as mentioned in Section III above), which shall be entitled to

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receive fees, commission or other consideration from the issuer / manufacturer of such financial products for the services provided by it. (g) Non-exclusive, non-binding investment advisory services to be rendered to a Client by the Portfolio Manager pursuant to the terms and conditions contained in the Investment Advisory Services Agreement.

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