13 Weeks Later

13 weeks ago today, we launched smallcase.

smallcase is built to help individuals like you & me invest better in the stock market. The stock markets represent the equity asset class, which has outperformed all other asset classes (incl real estate, gold, PFs, FDs) in the long term.

However, navigating the stock markets isn’t easy — there are too many variables to consider — you need to know & understand the stocks, their history, business, financials, growth numbers before taking a decision to invest

How smallcase makes it easier for you is we curate the right stocks into themes & ideas you understand — long term trends like the growing middle class, increasing internet penetration, investment strategies from celebrated investors like Benjamin Graham, Joel Greenblatt, currently trending ideas like Private Banks/NBFCs, the ongoing festive season, and many more (whole list here). This means you’re not investing into single stocks, rather portfolios of stocks — which is a much better approach to investing as it diversifies risks

We have a lineup of 48 smallcases right now, which on average has generated a return of +16.5% in the last 4 months (1 Jun-Sep 30) vs the markets (Nifty) movement of 5.49% in the same time period. The performance of all our model-based smallcases is around +21%

Let’s take a quick look at 4 of our most-bought smallcases:

Bargain Buys

Based on Benjamin Graham’s investment philosophy for a layman investor to buy stocks that have a strong financial position, manageable debt & stable earnings, Bargain Buys is also the smallcase that has the lowest investment amount (starts at Rs. 882 now). In the last 4 months, it has given an absolute return of +31%

Banking Privately

Another smallcase with +29% returns from June is a smallcase with private banks & NBFCs. Public banks have been suffering from low profitability & high number of bad loans, moving business to private banks that have a better banking network, better technology and higher productivity measures. Also, NBFCs are growing very fast due to the low credit penetration in our country — also boosted by the approval of FDI in NBFCs. The interest rate cut by RBI yesterday should also help this case

This smallcase has done extremely well in the last 2 years — generating a return of +93% compared to the Nifty’s 10% return (see graph below)

Banking Privately index in blue, Nifty index in orange

Monsoon Cheer

Our first short-term smallcase, Monsoon Cheer was made inactive last week as the monsoon season has ended. Launched in May on the back of IMD predicting an ‘above average’ monsoon this year, this smallcase with stocks benefitting from good rains gave investors a return of 20.6% from June to Sep-end.

The GST Opportunity

The most popular smallcase in the second half of July — it consists of the top companies from sectors that will benefit from the GST implementation next year. Showing a good performance till the bill passed in the LS (after which, there was profit booking in related stocks) — this smallcase still remains in our top 5 bought smallcases (including the low-cost version)