Small is Beautiful: Invest in small-cap mutual funds

Companies classified as small-cap have a market valuation of less than $2 billion. Their great growth potential makes them a potentially profitable investment. Additionally, there's a greater chance that they'll be disruptive and innovative, which could result in big profits for investors. These businesses have the potential to expand quickly because they are frequently just starting out.

Our Investment Strategy for Small is Beautiful

The Small is Beautiful portfolio is a growth-at-a-reasonable-price (GARP) strategy that makes medium- to long-term investments in small-cap firms that have the potential to grow quickly. The portfolio prioritizes businesses with stable profits, robust balance sheets, and fair prices. Additionally, it steers clear of industries that are fragmenting and supports those that are consolidating.

• Businesses with the capacity to increase profits more quickly than the market.
• Businesses that are not trading at their true value.
• Business with robust balance sheets showing sound cash flow and debt levels.
• Reasonable prices in relation to assets and earnings.
• Encourages industry consolidation with fewer participants.
• Avoids industries fragmenting with more players. 

What do you invest in with Small is Beautiful ?

• Potent small-cap companies with slight exposure to large & mid-cap for stability.
• Companies in wealth creation stage with growth potential & robust business models.
• Emerging startups in sectors like tech, finance, hospitality and capital goods.
• Mid-cap & large-cap companies to stabilize volatility in changing market conditions.

Small is Beautiful: Pros and Cons

Benefits

• These businesses have the capacity to expand quickly.
• Compared to larger enterprises, they frequently face less competition.
• Possibility of providing longer-term, better returns than bigger businesses

Drawbacks

• more erratic than bigger businesses
• Often less liquid than bigger stocks
• Small-cap companies typically have less information available about them.

Small is Beautiful: Annualised past returns 

• It has a high risk rating. 
• Benchmark: NIFTY 500- TRI

Who should invest with the Small is Beautiful Stack ?

Perfect for long-term capital growth seekers with an aggressive risk tolerance. These investors are prepared to assume greater risk in order to potentially earn better profits. Their long-term wealth growth, financial independence, and leaving a legacy for their kids or grandkids are some examples of their financial objectives. Small-cap firms are a good option for investors who want to diversify their holdings and increase the alpha they can produce.

• This is ideal for the age group of 18 years upto 45 years
• This is for investors who delve in aggressive risk investing 
• Investment horizon of 3+ years
• You can expect returns that outperform benchmark indices consistently
• This is ideal for investors with the financial goals of long term wealth creation and generational wealth.