A smallcase investment is a mixed portfolio of stocks or ETFs (exchange-traded funds). It is customised to suit a particular investment plan. Smallcase is similar to liquid stocks and doesn’t have any lock-in period. In simpler terms, it is an investment method that gives you flexibility while having liquidity.
You can exit these investments at any time without the fear of losing out on the entire investment. Smallcase investing can even enable you to invest in global technology stocks.
What is smallcase investment?
Smallcase was founded in 2015 by a fintech start-up of the same name. It was incorporated so that the investors can have access to a prepared portfolio rather than mutual funds. Created by SEBI advisors, brokers, and analysts, it used quantitative models and algorithms. All the stocks were screened through careful analysis and research to create the final portfolio.
You need a trading and a Demat account for smallcase investing and can go for either systematic or lumpsum investments. There is a nominal registration charge and transaction fee involved. Once you begin investing in smallcase, the amount will be debited and the shares will be credited to the Demat account.
What are the benefits if you invest in smallcase?
Smallcase investing increases your diversification with minimum risk. Here are some of the benefits that you’ll attain through it.
Investment Cost
When you invest in smallcase, you only have to pay around 0.2% during the transaction. There is no hidden cost and is considerably cheaper than other investment options. This makes smallcase investments a better choice for beginners.
Maximum Control
When you invest in a smallcase, your shares are in the Demat account and that gives you maximum control. The dividends are also transferred to the bank account directly. You always know where exactly your shares are and how much they cost at a particular time. As a beginner, you want to keep a tab on the investments rather than the fund manager.
Diversification of Portfolio
Smallcase investing involves a range of stocks, including an idea, theme, or strategy. The diversification revolves around these sectors. It is ideal for you if you want to actively invest and expand your portfolio.
No Lock-in Time
As already mentioned, you don’t need to specify a lock-in period and can exit anytime you want. If you are a new investor, this type of flexibility can help you understand the share market better and take time to make better decisions.
In Conclusion
Smallcase investment offers multiple benefits, including better transparency, no lock-in period, low cost, and complete portfolio control. So, if you are a beginner and want to ensure that there is no middleman involved in the transactions, this is the best way to go. If you have doubts regarding smallcase investment and are unsure about how to proceed, you can always seek a financial expert’s advice.
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