Bad experience with Kotak Securities
July 12, 2009 at 12:54 pm 11 comments
To parody an old song:
“Eye eye oh what shall I do, how should I save my skin?”
“I got stuck with Kotak PMS and now look at the mess I’m in!”
I have had a pretty bad experience with Kotak’s PMS. Sadly for me, I got in 2 years ago. A couple of months after I invested, the markets started tanking (and how!). I accept that as systematic risk. But over the past 18 months, returns have consistently remained poor irrespective of whether markets were going south or there was a general spurt in the Indian equity markets. So much for Kotak’s famed research and active management of portfolios!
And now that the portfolio has been liquidated, there is a delay in the proceeds being credited to my account. The cheque should have come in by 7th or 8th July at the latest so that I could have deposited it before 10th and earned interest. As the cheque has yet to reach me, I have suffered interest loss as well as opportunity loss in making fresh investments. SEBI should monitor “T+3″ across the industry, as I suspect there is more violation than compliance- at least in case of retail investors.
I can only rationalize that the “management fees” I paid Kotak Securities each year was towards teaching me a valuable lesson: stay away from Portfolio Management Schemes in general, and Kotak’s PMS offerings in particular. Expensive lesson, I must add. 
I would be keen to know if others have had a similar experience with Kotak- or indeed, other such companies as well.
Entry filed under: General. Tags: .
1.
Shreya | July 13, 2009 at 5:58 am
Dear Sir,
I am a representative from Kotak Securities. Please let me have your account details such as your client ID, the name in which the account is opened and the date when you liquidated your portfolio. i will personally check on the dealy and ensure that your cheque is sent to you at the earliest.
thanks & Regards
Shreya
2.
jeet | August 30, 2009 at 4:52 pm
I am watching.I kept a part of portfolio with myself.I am doing much better than what PMS has done.Excellent research is available free on CNBC/money control.com if one spends half an hour 5 days a week.and is generaly aware of economic world around.At least you will not curse somebody else.
3.
s k jain | December 26, 2009 at 6:27 pm
I too hakotak PMs since last about 14 months and to my dismay i havebeen charged even on unrealized gain. I feeel like cheated. I am just on verge of exiting and will not advice anyone to believe what they claim. I have been charged almost 8% of my portfolio even though portfolio has givn a negative return as compared to sensx. skjain sushiklkjain2008@gmail.
I
4.
Anurag Dabral | January 12, 2010 at 8:25 am
Am another “hurt” party in the Kotak PMS scam. Right now trying to exactly understand the numbers.
But i woudl be interested to know if you are aware if there is any existing forum anywhere and we could jointly take this up.
Or i could stat a forum.
Let me know.
I can be reached on 098217-78789.
Tks, Anurag
5.
anandkrishna | January 14, 2010 at 6:58 pm
Hi Anurag,
I’m not aware of any specific forum for taking this up. But because we signed all those forms at the time of signing up, I am sure there is little we can really do, as we agreed to the terms & conditions.
It would have been a nice gesture if Kotak had waived the fees for non-performance. I know they fired a bunch of people last year- although that is little consolation.
But one thing I have decided- no more Kotak products for me- no matter how silly this sounds and I may in fact be cutting off my nose to spite my face.
6.
HS | February 27, 2010 at 3:49 am
Joining to the group of investers dupped by KOTAK PMS. Do not go by their fancy site and mentioning of various awards.
I really doubt if some professional is managing the PMS at KOTAK. My portfolio started at 2008. It saw downs of 2008 and then ups of 2009 market but PMS is still lagging the returns given by Sensex.
Can one imagine if they cannot beat even sensex then what is the kind of research team they would have. I believe they are just like us with some degree in some financial course. When markets are good everybody (even Dick and Jane) can earn profit.
I think people overall should avoid PMS.
Apart from these their advisors tell/promise you any thing. They took shares worth Rs 10 Lac from me instead of cash. But PMS manager sat on them for 3 – 4 months and sold at loss and netting Rs 8 lac. So according to them I have started PMS with Rs 8 Lac. Straight away I lost Rs 2 Lac because of their mis management. But advisors told me the day shares are transferred to their account their net work is taken as my contrubution to PMS.
PS: Reliance PMS is working fine giving profit although started at same time (10%). While KOTAK is giving me loss of whopping 30% (net work Rs 7 Lac) These are actual figures I can share account details/reports any time.
7.
Sanjay | June 20, 2010 at 12:37 pm
I am not sure about Kotak PMS, because I never used or invested with their PMS. But now that I am reading these comments, I guess they might not be having the best luck. But maybe they didn’t do it on purpose and honestly, some mistake happened? What they did wrong was not treat customers with respect. I have also been investing in the FAMS PMS for three years now as a close friend suggested it to me, and my experience has been very good. My initial capital has grown by around 450%, but maybe there is some element of luck to it or it is easier to beat markets in a free PMS style system.
I don’t think criticizing Kotak so much is the right thing to do, because they are not out to scam and cheat innocent people. It is just a casualty of the investment game.
8.
Narayan H.C | September 12, 2010 at 4:24 am
Kotak Securities under Portfolio Management are cheaters .All decisions taken on managing PMS is systematic siffoning of capital forget return. No one in the establishment have cortesy to acknowledge failures and aree adament in advertising “Investment ka bare me humse behathar kaun jane”
Article published by the promoter in Times Of India clearly spelt the management culture how to improve the asset and have been successful in their growth while investors suffred. At least now investors should be alert with Kotak
9.
Harish Rao | April 26, 2011 at 12:36 pm
I am a journalist and working on a story how Kotak PMS has performed poorly causing heavy losses to investors. If anyone of you is willing to share your experiences kindly put in a mail.
Thanks.
10.
Rolston | November 24, 2011 at 6:15 pm
Well Wat to say… I was once associated with Kotak pms and it was nothin short of a badly managed firm. Grossly incompetent staff and poor man management. I was fortunate to move out and this whole I’ve came crumbling. This was always on the cards.. From a top pms house during my time at Kotak (2005-06), to now defunct entity. I feel sorry for the scores of my past colleagues who continued there… Dunno Wat will be their position as on today.
Imp lessons to learn while investing in pms
1) track record of the portfolio manager has to be relevant and impeccable. Money management is not Tom dick Harry job.
2) as an investor; track ur portfolio minutely and raise an alarm if u see any wrongdoings… If unheard, wind up ur portfolio. There r better players in the market
3) greed always leads to downfall. Know where to stop
11.
KEDLA PURANDAR | February 10, 2012 at 6:21 am
I have a case of a customer in Bangalore referred to by my Advocate daughter about PMS of Kotak Bank. Between November 2007 and February 2008, just in a matter of 3 months the Bank not only lost due their speculative and bad investment decisions, the entire PMS amount of Rs.5.00 lac placed with them, but also they had cheek to raise a claim from the PMS client Rs.1.00 lacs as dues to them. The matter is before consumer court for poor customer service. The customer failed to approach SEBI at the right time for compensation and penal action against the Bank for not followimg PMS guidelines and for playing with the funds of the customer in speculation instead of building a sound security portfolio ( could be a model portfolio as they claim ) the basic objective of PMS. Beware of PMS!
KEDLA PURANDAR