When it comes to Investing in the Stock Market:
Most people are clueless. They fear that
- One Needs to have a Strong Knowledge of Finance or
- Invest a lot of Time and Money or
- Read up a company’s Financial Reports or do long hours of Technical Analysis
Though this was true 1-2 years ago.
Times have changed.
You can now Invest Passively, taking advantage of the Experience and Knowledge of Professional Investors.
Using Financial Products like SmallCase.
By the end of this Article, you will Understand what is Smallcase, how to Invest using smallcase, Smallcase Reviews and Top Performing Smallcase to Invest in 2022.
Let’s get started:
What is smallcase?
Smallcase is a platform built by smallcase technologies, a Bengaluru-based company.
Smallcase provides users with a basket of stocks based on a particular theme, strategy, or idea. It is created and managed by SEBI(Securities and Exchange Board of India)-registered professionals. This is the first initiative where one platform is made accessible to many investors.
Smallcase provides only the portfolio for the users while the investment should be done using your broker accounts.
It has partnered with more than 10 companies to manage the investment. They include Zerodha, Axis Direct, HDFC Securities, Kotak Securities, 5paisa, Trustline, Angel Broking, Upstox, Motilal Oswal, Edelweiss, IIFL Securities, and Alice blue.
How does smallcase work?
Smallcase follows few algorithms and has a dedicated research team to frame the stock portfolios around various themes and ideas. They study and analyze companies, the economic situation, and various other factors which help them with their strategies to create various portfolios for you to choose from.
These portfolios are rotated and rebalanced periodically based on the economic condition.
They also contain the list of companies and their weightage thereby giving you high visibility.
By using smallcase investment, you are directly buying stocks. You will be using your money from your trading account and will get your stocks in your Demat account. You may ask, how much does smallcase charge? Well, smallcase does not charge any handling fee, it is charged by it’s brokerage partner.
How is smallcase different from other Investments?
Smallcase is highly flexible and customizable. Though the stocks are put together as a portfolio, you can add or remove stocks as per their needs.
Alternatively, you can custom create your portfolio with the help of smallcase screener. Screener by smallcase helps you find the right stocks easily with over 120 filters to choose from. Rather than investing and relying on a single company, it’s good to invest in a portfolio that has diverse companies.
Smallcase vs Mutual funds
Smallcase is a combination of Direct equity and Mutual fund investing. Here are some of the differences between mutual funds and smallcase.
Ownership – In Mutual funds, well-researched portfolios are put forward and taken care of, and managed only by a fund manager. On the other hand, smallcase gives you ready-made portfolios put together in themes by professionals, which you can understand, modify and maintain according to your preference.
Dividend – Unlike mutual funds, the stocks are not held in smallcase, rather the stocks are sent in a Demat format to your account making you a shareholder.
Dividends are also directly transferred to your account which is not the case with mutual funds.
Transparency – The transparency of your stocks is relatively high in smallcase, you can view them anytime, whereas mutual funds disclose stocks only once a month.
Smallcase has created more than 50 themes and strategies. We have curated a list of 10 best performing smallcases for you to invest in 2022:
Top 100 stock
Top 100 stocks is a smallcase that has a collection of powerful companies and is managed by Windmill capital. This smallcase invests in top 100 market cap companies. This is for anyone who wants to build wealth for the long term. It is medium volatile with an annual growth rate of 18.89%.
This particular smallcase investment for the top 50 is made using Nippon India ETF Nifty bees and the next 50 companies are invested using Nippon India ETF junior bees. The minimum amount for this portfolio is Rs 570 and this can be a great portfolio to invest in if you are a new investor.
Growth at a fair price
This basket is made up of growth companies that have positive earnings.
Generally, these companies have a lot of investment opportunities because they have a reasonable margin of improvement with potential earnings. Such companies can be a great option for investment.
This smallcase has high-growth companies at fair valuations, comprising stocks from Cement, Pharmaceuticals, Fertilizers, Chemicals, and Construction companies. This has high volatility with a minimum amount of Rs 11,102. The annual growth rate of this smallcase is 18.32% and the stock is being managed by Windmill capital.
Affordable housing comes under the PMAY (Pradhan Mantri Awas Yojana) scheme launched in 2015. This scheme aims to build 2 crore affordable houses for the lower-income community over 7 years. This smallcase refers to the current and future housing units and consists of companies that can benefit from this scheme.
It consists of stocks from Housing and Finance companies, Electrical, Paint, Cement, and Construction companies that can build affordable houses. This basket is medium volatile with an annual growth rate of 17.06% and a minimum amount of Rs 35,318.
Low Risk – Smart Beta
This smallcase will be the best fit if you are looking for a passive long-term investment. It is managed by Windmill capital. This smallcase has low volatility and has consistently performed better than few high-risk stocks. This Low-risk basket is made of liquid stocks picked from the top 150 market cap stocks. The annual growth rate comes around 16.36 % with a minimum amount of RS 76,094.
The stocks have been curated from a wide range of segments namely Heavy electrical equipment, Pharmaceuticals, Foods, Paints, Personal products, Life science services, Household products, Footwear, IT services, Diversified chemicals, and Alcoholic beverages.
Indian Healthcare Momentum
Indian healthcare momentum is a high volatile portfolio, managed by Flameback capital.
This smallcase follows a multi-cap strategy and is rebalanced monthly. The healthcare strategy is an intensive portfolio that consists of the top 10 Indian healthcare stocks that are ranked high on the momentum factor. This has a high percentage of annual growth rate, around 95.49%, and the minimum amount is Rs 42,711. This momentum is based on Diagnostic, Hospital, and Pharmaceutical companies.
Quantamental – Q10
This is a concentrated portfolio consisting of up to 10 stocks from large and mid-cap companies. These kinds of multi-cap portfolios are often dominated by smallcaps, but a balanced portfolio should have an equal contribution of large and mid-cap companies.
This combination results in better performance, whereas smallcaps tend to underperform.
Q10 is a high volatile portfolio, managed by Intelsense.
The strategy of this portfolio is not just based on fundamental style, it has been powered by quantitative systems. The minimum amount of this smallcase is Rs 37,187 with an annual growth rate of 35.22% and it is rebalanced weekly. Q10 has beaten benchmarks with its historical performance, which makes it an ideal smallcase to invest in for a long-term strategy.
This smallcase is combined based on the company’s liquidity, ratios, and fundamental sanity. Capitalmind momentum has up to 25 stocks and aims to capture the momentum. The rebalancing is done weekly and is being managed by Capitalmind.
This portfolio is low volatile with a minimum amount of Rs 55,937. Any foreseeable changes are made on the first day of trading, usually Monday. Capitalmind has been using the momentum strategy for almost 4 years now and it has an annual growth rate is around 61.56%
Mi_MT_allcap is a momentum portfolio managed by Weekend Investing. This portfolio has 20 stocks comprising large and midcap companies and follows the trend of medium-term momentum. The ultimate strategy of this portfolio is to generate wealth gradually by keeping a track of the winning stocks. It has low volatility with a minimum amount of 97,330 and an annual growth rate of 53.46%.
Reviews are done every week and stocks which do not hold ranking are altered with new ones. If new momentum is not available, then the portfolio sits in cash. The greatest advantage of the momentum strategy is that it never allows the portfolio to end in loss. It has bigger wins and smaller loss making it the desired portfolio.
This smallcase consists of companies that are India’s everyday brands. The brands that have been able to prove their power in creating a customer connection. Our spending and consumption habits have increased over years and this creates demand across food, clothing, and household sectors. As a result, these companies benefit from consumption.
This portfolio is medium volatile with an annual growth rate of 18.50% and a minimum amount of Rs 54,307. It has stocks from segments like Paints, Personal products, Two-wheelers, Four-wheelers, Electronics, Private banks, Insurance, Department stores, Restaurants, Household products, Hospitals and diagnostic centres, Precious metals and Brewers.
All Weather Investing
All weather investing is a single smallcase for all market conditions that consists of Gold, Equity and Fixed Income.
It has one single goal – To provide great long terms results irrespective of Market Conditions.
Periodic Rebalances are done to generate relatively high returns. The volatility of this stock is low with an annual growth rate of 14.02%.
Minimum Investment Amount – Rs 4246
Smallcase Managed By – Windmill Capital
On a whole, this smallcase has high liquidity, it is cost-efficient and gives greater values.
Overall, Smallcase is a good Investment option for Passive Investors.
This is a very innovative approach and helps you easily build a portfolio for yourself without a lot of research.
Disclaimer: For Educational Purposes Only. Check with certified experts before taking any investment decisions.