Smallcase investing: All you need to know

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Smallcase has gained a lot of popularity as an equity product of recent times. Weekend Investing’s Alok Jain joined Priyanka Sambhav in the show Save Nahi Invest Kare, to explain what smallcase investing is and how it is different from buying stocks directly or mutual funds. He also talked about the expenses and costs related to smallcase investing and what returns from smallcases should investors expect on their investments.

What is Smallcase investing?

Small case investing is a new type of investing. It is portfolio-based investing, where people pick stocks and invest on their own. There are managers who are making these small cases. The portfolio is built on different themes like affordable housing, electric vehicles, basically, stocks that will benefit from that theme. It can also be gold stocks, bonds, etc. The strategy managers help the investors in designing the portfolio and the investor will engage in the execution part of investing.

There can be two to 50 stocks in the smallcase. It can be two ETFs or a momentum portfolio with 50 stocks. There are different types of investing.

Jain said an investor can build a theme-specific portfolio.

“Value investing, dividend investing, growth investing, momentum investing are the types of investing one can indulge in. Then there are specific themes, like electric vehicles, affordable housing, pharma theme, mid-cap pharma companies, etc. That can also be an approach. It depends upon how the portfolio is designed by the manager. There can be very focussed themes or there can be very broad schemes,” he said.