To help you navigate your way in selecting smallcases, there are few things you can do:
- Search smallcases by name, manager name, investment strategy
- Try out filters based on volatility, min. investment amount, investment strategies etc
- Sort your filter smallcases based on popularity, min, investment amount, recently rebalanced smallcases and returns
Whether you are a seasoned investor or buying your first smallcase, the process of selection and evaluation is something everyone goes through. Just as everyone has their own goals associated with investment, evaluation criteria too, is very different for each investor.
Understand investment strategy behind every smallcase
- Each smallcase comes with a concise rationale which is the main principle or reason, to help you understand why you should invest in it
- The rationale will tell you about the idea behind the smallcase as well as the kind of companies that the smallcase comprises
Eg: Brand Value smallcase consists of companies that will benefit from the increase in consumption of branded goods in India.
What is smallcase volatility?
Understanding volatility while investing is as important as analysing returns. Based on your investment horizon and appetite you can make a decision and select your smallcase accordingly.
- Volatility is the tendency to change rapidly and unpredictably
- Eg: Rapid changes in the investment value of your smallcase would result from changes in the prices of stocks within that particular smallcase. Such smallcases are said to have high volatility
- Each smallcase shows the volatility and is categorised into one of the three volatility buckets – High Volatility, Medium Volatility and Low Volatility
How can returns be compared?
The stock market moves in unison with recession and growth cycles. Therefore it is wise to look at time periods that span across differing economies and cycles.
- smallcases have been launched in different time periods. Comparing a smallcase which was launched 5 years ago with a smallcase which was launched recently, will not be comparing apples to apples
- It is important to keep in mind the launch date of smallcases and also seeing how many market cycles the smallcase has gone through
- You can sort smallcases based on 5 time periods – 1M/6M/1Y/3Y/5Y
- smallcases which were not live in the selected period will be excluded from the sort results
Each smallcase has a ‘minimum investment amount’. What does it mean?
- Every smallcase has a prescribed weighting scheme decided by the creator of the smallcase
- Minimum Investment Amount is the lowest amount that you necessarily need to put in, in order to invest in a smallcase
- It is decided based on the current price of stocks/ETFs that comprise a particular smallcase
smallcase Managers – the brains behind each smallcase portfolio
smallcases are created and managed by experienced SEBI-registered professionals also known as smallcase Managers. They create and manage ready-made investment portfolios as smallcases, based on diverse investment strategies and objectives.
- Windmill Capital: Experienced Manager creating smallcases on the platform since 2016. Their construction methodology is driven by data
- Independent managers: They are SEBI registered investment advisors who create and manage smallcases. Each manager follows a specific investment strategy which investors can readily invest in
You can view the manager name on smallcase profile or see the complete list of managers on the “Managers” tab.
What are free and fee-based smallcases?
The smallcase platform has a range of investment portfolios that one can select from. While many smallcases are free for you, some require an access-fee.
- Fee-based smallcases, like free access ones, are stock/ETF based portfolios built by experienced SEBI-registered experts
- But unlike the free access smallcases, they have an access-fee attached that is charged by the respective smallcase managers
- The fee is charged by the respective smallcase managers, to avail the benefits of their research and expertise in creating portfolios.
Both these help in increasing the flexibility of the smallcase ecosystem to cater to the different needs of different investors.
While making an investment decision it is important to look at both qualitative and quantitative aspects of a smallcase. It helps you put together a more complete picture.