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Hear these 6 wise voices before investing in smallcase!

smallcases are model portfolios of stocks/ETFs based on a theme, idea or strategy. It is a modern investment instrument for investors to build long term diversified portfolios

December 28, 2021 / 11:16 AM IST

We have always discussed the importance of saving and investing and also why it is so important to achieve Financial Freedom. Now that we all agree that investing is important and it's also an established fact now that Equity as an asset class has outperformed consistently across all asset classes over a long term period its time we explore and understand how to Invest in equities.

Post-2008 investors realised the hard way that it’s a full-time job of someone who specialises in identifying businesses. They also help investors and stay put and navigate the behavioural challenges which an investor goes through while witnessing various ups and downs. And we saw the rise of the Mutual Fund Industry where investors started investing their money through these professional fund managers. As the size of the industry grew it became more and more challenging for the professional fund managers to beat the benchmark.

By now the investors are getting more mature and well-read too to a certain extent and they have started to realise the potential of investing in portfolios and having an advisor on their side.

The best way to invest in equities is to invest in portfolios/ideas and what better than smallcase when it comes to investing in ideas So what’s a smallcase?

smallcases are model portfolios of stocks/ETFs based on a theme, idea or strategy. It is a modern investment instrument for investors to build long term diversified portfolios.


Now that we understand what a smallcase is, it’s very important to understand which smallcase to invest in and who designs these smallcases.

smallcases are created by SEBI registered professionals. smallcases have brought a lot of flavour to investing as they are created across various strategies, market segments, sectors and risk profiles.

We spoke to some of our popular smallcase managers and they highlighted some very important factors to consider while choosing a smallcase.

Divam Sharma, Founder and CEO, Green Portfolio

-Self-Personality traits - These help you choose the style of investing i.e. value, growth, momentum, dividend. The equity advisor should match with the style of investing that matches your personality.

-Skin in the game - The equity advisor’s personal investments in the stocks suggested could be considered as a metric to look at. The advisor should walk the talk himself.

-Execution skills - The advisor should have delivered consistent returns in the past which should be as per the expectations set by him. Advice without an execution history is not a good quality to have in an equity advisor.

High Quality Right Price smallcase by Green Portfolio

Amit Kumar Gupta, Research Analyst, Adroit Financial

“Review an advisor's educational background and experience to learn why that particular person may be uniquely positioned to help you with your financial situation or how one can actually apply their knowledge to develop an optimal strategy for you. In case you are accepting a financial product from them, understand their investment strategy before buying.”

Understand how often and with whom you will be interacting. Most good advisors provide ongoing support throughout the year to help with the implementation of a financial plan and/or are available to guide you through the volatile timeframe of the market.​​

Special Situation smallcase by Adroit Financial Services

Gautam Baid, Founder, Stellar Wealth

Track record, investment philosophy and client orientation are major factors to look into before investing.

Stellar Wealth FlexiCap Portfolio smallcase by Stellar Wealth

Rajesh Kothari, Founder and Managing Director, Alfaccurate Advisors

-Governance - is there any conflict of interest? Governance is one of the most key aspects to look at when investing in a smallcase. We need to make sure that there are no conflicts in our interests when it comes to our investments.

-Experience - Minimum of 10 years is a must for any Manager according to us.

-Disciplined portfolio management - Not just stock picking but portfolio construction and management that is given due care throughout.

AAA NEXT Generation smallcase by AlfAccurate

Devina Mehra, Managing Director, First Global

Do they have a proper system that they follow with consistency and replicability?

Or is it dependent on what 1 (or 3) person likes? In which case you will see yo-yo returns. May even do better than the market for a certain period but won't sustain

How do they manage risk? Or is the focus only on maximizing returns? The integrity and track record of the advisor. How seriously do they take their fiduciary responsibility? Do they invest only in liquid securities? Are their charges upfront and clear? And so on

FG-HUM [First Global Human + Machine Model] smallcase by First Global Finance Private Limited

Ambareesh Baliga, smallcase Manager

-Check how many market cycles the advisor has seen / preferably 2 or more so that investors can eliminate some common mistakes.

-Most advisors are excellent salespeople too - but check whether they are good listeners. Because at the end of the day they have to provide solutions as per your requirement.

Underdogs too will shine smallcase by Ambareesh Baliga

With all these great tips and tricks in mind, here’s to good Investing so that you can make an investment decision that is beneficial as we step into 2022. Wishing you all a Happy New Year ahead!

For More Details on smallcase in Moneycontrol Click Here.

(Disclaimer: The views/suggestions/advices expressed here in this article is solely by investment experts. Moneycontrol suggests its readers to consult with their investment advisers before making any financial decision.)

This is a partnered post with smallcase
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Tags: #smallcase
first published: Dec 27, 2021 02:45 pm
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