top of page

Do More Smallcases Mean More Profit?



Smallcase is Easy

A fascinating new development for retail investors is smallcase. A smallcase invests in a selection of stocks or ETFs that have been carefully chosen by experts. Unlike a mutual fund, you actually own the stocks with smallcase. As a result, it only takes a few clicks to create your own stock portfolio.

Smallcase is frequently promoted as a simple method for investment diversification.


Diversification is a risk management tactic that incorporates a wide range of investments into a portfolio. To reduce exposure to any one asset or risk, a diversified portfolio combines a variety of different asset classes and investment vehicles.


Buying Multiple Smallcases

A smallcase typically has a theme at its core. This means that if a market event affects a specific stock, it is very likely to jeopardise the entire investment thesis. If you have a few smallcases, they can help you deal with market volatility.


Investors may also want to purchase multiple smallcases from different providers to reduce risk. If diversification is beneficial, one might be tempted to spread their capital across a variety of smallcases.


Is It a Good Idea?

As easy as buying multiple smallcases sounds it comes with a few cons

  • Owning more smallcases will cause more problems because you will have to pay a minimum amount in fees for each smallcase. As compounding sets in, this will significantly reduce your corpus over time.

  • There is already some overlap in equities owned if you own multiple smallcases. With a limited number of equities in the Indian markets, it is natural that some well-performing stocks will be repeated as you acquire more smallcases. With this comes concentration risk.

  • One smallcase typically contains 10-15 stocks; purchasing ten of these will result in 100-150 stocks in your demat account. This will be extremely difficult to track.

  • No matter how much capital you put into 10-15 smallcases, only a percentage or a portion will be allocated to a specific stock. That means that even a multi-bagger will not produce significant returns for your overall portfolio.

  • True diversification entails investing in more than one asset class. Smallcase may limit you to stocks, bonds, or even ETFs. For true diversification, you must invest in various uncorrelated asset classes such as gold, real estate, cryptocurrency, commodities, and international equities.

In Sum

Purchasing multiple smallcases will not increase your profits, but if done methodically, you can utilise it to reduce your risk. Choose 2-3 smallcases that correspond to your investment objectives. Stick with the themes you've chosen and give them time to shine. Don't give in to market volatility and switch between smallcases.


Check out our selection of Rupeeting Equity portfolios on smallcase, which aim to outperform the market while charging the smallest fees. Our experts have over 50 years of combined investment expertise and have overseen the management of over Rs. 50,000 crore.




Comments


Rupeeting

Powered by Paterson Securities Group

  • Rupeeting Youtube
  • Rupeeting X
  • Whatsapp

Email: sawaal@rupeeting.com

Support: +91 97697 70046

22/A Shah Industrial Estate

Off Veera Desai Road

Andheri West

Mumbai 400053

Rupeeting Logo.png

Alphaware Advisory Services Private Limited (Brand Name - Rupeeting) makes no warranties or representations, expressed or implied, on products and services offered through the platform. It accepts no liability for any damages or losses, however, caused in connection with the use of, or on the reliance of its advisory or related services. Past performance is not indicative of future returns. Please consider your investment requirements, risk tolerance, goals, time horizon, risk and reward appetite, and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs. Performance and returns of any investment portfolio can neither be predicted nor guaranteed. Investments in mutual funds, stocks, ETFs and any other investment products that you see Rupeeting's views being expressed on are subject to market risks. Please read all scheme related documents carefully. The content and data available in the material prepared by the company and on the website of the company, including but not limited to index value, return numbers and rationale are for information and illustration purposes only. Charts and performance numbers do not include the impact of transaction fee and other related costs. Past performance does not guarantee future returns and performances of the portfolios are subject to market risk. The information is only for consumption by the client and such material should not be redistributed. Data used for calculation of historical returns and other information is provided by exchange approved third party vendors and has neither been audited nor validated by the Company. Detailed return calculation methodology is available here. Detailed volatility calculation methodology is available here. Registration granted by SEBI, membership of BASL and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Alphaware Advisory Services Private Limited [SEBI RIA Registration No: INA000015747] [Validity of registration: February 08, 2021-Perpetual] [BASL ID: 1610] [Address: 22/A Shah Industrial Estate, Off Veera Desai Road, Andheri West, Mumbai 400053] [Principal Officer details: Mr. Sagar Lele, Email id: sagar.lele@rupeeting.com, Contact No. +91-9769770046] [Compliance Officer details: Mr. Sagar Lele, Email id: sagar.lele@rupeeting.com, Contact No. +91-9769770046] [Grievance Officer details: Mr. Sagar Lele, Email id: sagar.lele@rupeeting.com, Contact No. +91-9769770046] [Platform Partner: smallcase] [CIN – U74999MH2019PTC320573] [GST No: 27AARCA8847R1ZF] [SEBI regional address: SEBI Bhavan BKC, Plot No. C4-A, 'G' Block, Bandra-Kurla Complex, Bandra (East), Mumbai, Maharashtra, India, Pin Code – 400051.]

© 2025 by Rupeeting

bottom of page