How to Sell a smallcase: Guide on Complete & Partial Exit
This article explains how to sell a smallcase step by step, whether partially or fully, and covers key aspects like exit options, authorisations, brokerage charges, and capital gains tax rules. It’s your complete guide to managing and exiting smallcase investments with confidence.
smallcases are curated portfolios of stocks, ETFs, or mutual funds built around specific themes or strategies. While they’re typically meant for long-term investing, there may be times when you want to exit, either partially or completely. Whether you’re reallocating funds, need liquidity, or have met your investment goals, understanding the process is key. This guide explains how to sell a smallcase step by step, what to keep in mind before placing the order, and the charges and tax rules involved.
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How to Sell a smallcase – Step by Step Guide
smallcases are intended for long-term wealth creation. However, you can sell them when the need arises. One of the reasons why investors consider smallcases is that there are no lock-in periods.
In short, you can literally sell them whenever you want!
However, you can choose to completely or partially sell your smallcases, depending on why you’re exiting your investment.
Here, “complete exit” refers to selling off all the units of a particular smallcase. In other words, it means closing out the entire investment corpus in a smallcase.
On the other hand, “partial exit” refers to selling a portion of the units held in a particular smallcase. It simply means reducing the investment position in a smallcase after selling shares when cash is available or some of the stocks or securities that make up the smallcase.
Now, let’s understand how you can fully as well as partially exit your smallcase in more detail below.
How to Sell Your smallcase Investment Portfolios?
Selling your smallcase is a simple process you can complete directly through your investment platform. Here’s how to exit smallcase step by step using your broker or smallcase platform.
1. Log in to your account
To sell your smallcase, log in to your account on the smallcase app (Android or iOS) or website, navigate to your investments section, and follow the steps to sell your desired smallcase.
2. Go to ‘Investments’
Once you’re in, go to the “Investments” tab. This section shows all the smallcases you currently hold.
3. Select the smallcase you want to sell
Choose the smallcase you want to exit. You can decide to sell the entire portfolio or just a part of it.
4. Click ‘Exit smallcase’
Click on “Exit smallcase” to start the selling process. You will now need to choose between a full exit or a partial one.
How to Sell a smallcase Completely?
A complete exit from a smallcase means you wish to sell all the holdings within it. If you’re ready to fully exit a smallcase, here’s how to sell all your holdings in one go.
Sell all your holdings in one go
Click on “Exit smallcase” on the smallcase details page.
Choose the ‘Whole’ option
When asked to confirm the exit type, select “Whole”. This tells the system that you want to sell all securities in that smallcase.
Review and confirm
Check the order details carefully, including the securities, quantities and fees. Once everything looks correct, confirm the order to complete the sale.
This process helps you exit your smallcase portfolio completely in a few clicks. Now, let’s look at the partial selling of a smallcase investment.
How to Sell a smallcase Partially?
For investors who wish to reduce their exposure to a particular smallcase without fully exiting, a partial exit is an available option. This allows you to sell a portion of your holdings while retaining the rest of your investment. Here’s how you can partially exit a smallcase.
Sell only a part of your investment
Similar to a complete exit, you start by clicking on the “Exit smallcase” option. However, instead of selecting “Whole,” you will select “Partial” under “Confirm Exit Type”.
Enter amount or percentage
Type in how much of the smallcase you want to sell. You can enter either a specific amount or a percentage.
Check if partial exit is allowed
Note: Partial exits are only allowed if your investment is higher than the minimum required for that smallcase. If you have only invested the minimum, this option may not be available.
Review and confirm
Look over the breakdown of securities being sold and any applicable charges. Confirm the order to proceed with your partial exit.
Do I Need to Authorise PoA or Use e-DIS Before Selling?
Yes, in many cases, you may need to authorise your sell orders. If you have not provided a physical copy of your Power of Attorney (PoA) to your broker, you will likely need to authorise your sell orders electronically. This authorisation is typically done through e-DIS (Electronic Delivery Instruction Slip) via your brokerage platform. To sum up, if PoA is not submitted, you’ll need to authorise e-DIS for smallcase sell before completing your order. This step ensures that your broker has the necessary permission to execute the sale of your securities on your behalf.
Are There Any smallcase Exit Charges?
There is no exit load in smallcase. While there are no direct charges from smallcase for the act of selling your investment, it is important to be aware that your broker may impose brokerage charges for executing the sell orders. Therefore, while the smallcase platform itself doesn’t levy an exit fee, the brokerage associated with your account will charge for the transaction.
Can I Sell/Exit a smallcase Anytime?
Yes, a significant advantage of smallcases is that they typically have no lock-in period. This means you are generally free to exit your investment any time. You have the flexibility to sell your shares and exit a smallcase whenever it suits your investment strategy or personal needs. Please note that you can place a sell request at any time; they can only be processed during market hours. For instance, if you place a sell order on Saturday (market off day), the order will be processed on the next market open day (Monday).
How Can I Reduce My smallcase Investment Amount?
You can also downsize your position by selling a portion of your investment in your selected smallcase. For example, selling half of your shares in each company reduces your ownership proportion. To do this:
- Log in to the smallcase website/app and go to the Investments page.
- Select the smallcase you want to exit.
- Click the ‘Exit smallcase’ button.
- Choose ‘Partial exit’ and enter the amount.
- The smallcase’s current value will be shown.
- Confirm the sell orders in a confirmation step after placing the partial exit order.
When Should I Think of Selling a smallcase Fully or Partially?
Deciding when to sell a smallcase depends on your investment objectives, financial goals, and overall market conditions. Here are some general situations when you might consider selling a smallcase:
- Achieving your financial goals: If your investment in the smallcase has reached your target price or achieved the desired returns, you can think of selling the smallcase to realise your gains.
- Changing market conditions: If there is a significant change in the market conditions, such as a stock market crash, you might want to sell the smallcase to minimise your losses. Alternatively, you could manage or rebalance your smallcase to keep up with current market conditions, as mentioned below.
- Rebalancing your portfolio: If you are not getting the desired returns from your investment plan, you might want to sell the smallcase to rebalance your portfolio.
- Need for funds: smallcases are designed to help you achieve your long-term goals. So, if you require funds for an emergency or other purposes, you might want to sell your smallcase to generate the required cash flow.
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What Taxes Apply When I Sell (STCG / LTCG)?
Understanding smallcase capital gains tax rules is important. Selling your smallcase investments can trigger capital gains tax liabilities, with the specific tax rate depending on how long you have held the investment. There are two primary categories for capital gains:
- Short-Term Capital Gains (STCG): If you sell your smallcase within 12 months, any profit is treated as short-term and taxed at 15%.
- Long-Term Capital Gains (LTCG): If you’ve held the investment for more than a year, profits fall under long-term capital gains. These are taxed at 10%, but only on the portion that exceeds ₹1.25 lakh in a financial year.
Please note that this is for informational purposes only and should not be treated as tax advice. Before investing, it is worthwhile to connect with a professional to get the tax information on your investments.
Things to Keep in Mind Before Selling a smallcase
Before finalising the sale of your smallcase, it’s important to reiterate a few critical points:
- Investment Goals and Risk Tolerance: Always ensure that selling aligns with your current investment objectives and your comfort level with risk.
- Tax Implications: Be fully aware of the potential short-term or long-term capital gains tax that may be levied on your profits.
- Brokerage Charges: Remember that while smallcase itself doesn’t charge for selling, your broker will likely apply transaction fees.
- Partial Exit Minimums: If you plan a partial exit, confirm that your investment meets the minimum amount required for such a transaction.
What Happens After You Sell a smallcase?
After you successfully sell a smallcase, whether completely or partially, the underlying shares are liquidated from your portfolio. The proceeds from the sale are then credited to your linked brokerage account. This process effectively removes the specific smallcase or the sold portion of it from your active investments list on the platform. This is how you withdraw money from a smallcase after selling, through your linked broker account.
Before You Go
You can sell your smallcase anytime, either in parts or all at once, using the app or website. There’s no lock-in, so the timing is entirely up to you. That said, it’s worth checking the latest notes from your smallcase manager. Sometimes, just revisiting their rationale can help you see things differently and decide whether you want to hold on a little longer or not.
FAQs
To exit smallcase step by step, log in to your smallcase or broker platform, go to Investments, select the smallcase, click “Exit smallcase,” choose between “Whole” or “Partial” exit, review the order details, and confirm the sell.
The ‘Partial Exit’ allows you to sell a portion of your smallcase for funds, when to sell a security for profit. It may slightly vary from the initial minimum investment to maintain the weightage.
Yes, you can sell smallcase shares anytime in a smallcase because smallcases typically have no lock-in period.
You can exit a smallcase whenever you wish, as there is no lock-in period.
Periodic smallcase rebalancing keeps your portfolio in sync with the theme or strategy. This benefits you by adjusting holdings to market changes.
Rebalancing a smallcase is an important process that involves adjusting the asset weights to maintain the portfolio’s original asset allocation. If you don’t rebalance, your smallcase’s asset allocation may drift from its intended strategy over time, potentially impacting its performance relative to its original design. It also protects you from market volatility.
Yes, you can withdraw your SIP in smallcase anytime. However, there may be some charges associated with the withdrawal. The exact charges will depend on the smallcase you are invested in.
Yes. By finding the “exit” option on the right side of the screen on the site or scrolling to the bottom of the smallcase in the app.
First, choose your smallcase from your investments. Click on Manage. Add new stocks/funds by searching. Adjust quantity/weights with the “+” and “-” steppers. Review and confirm your order. Managing also updates the active SIP on that smallcase.
Visit your Investments, choose the smallcase with active SIP, and click Edit SIP. To conclude the SIP, simply click the “End SIP” button in the Edit SIP window.
While there are no direct charges from smallcase for selling your investment, your broker may levy brokerage charges for executing the sell orders.
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