Introduction
The smartNifty smallcase focuses on companies from the Nifty index. Now, one would feel how this is different from a Nifty ETF; historically, it has been seen that NIFTY, which comprises 50 top companies, has only about 20-25 companies that perform exceptionally well.
The objective of the smallcase is to handpick the bluest of the blue stocks from the nifty 50 universe that outperforms the market. This enables us to create alpha for our investors.
Investment Drivers
Stocks that outperform the index drive the index upwards. At the same time, the rest of the companies end up underperforming the market and thus bring the index down. Cumulatively the index does end up in green (mostly). So imagine if one could identify those 20-25 outperformers and only invest in them; this way, you can easily outperform the NIFTY index.
This is exactly what we at green portfolio aim to do via this smallcase. Our team of experts and professionals identify these 20-25 outperformers and help you invest your money in only those stocks and consequently help you multiply your wealth.
Investment Philosophy
Only those companies are chosen that have a strong balance sheet and this is made sure by picking only those stocks that have low debt on books. D/E ratio is an essential screening criterion here. Buying a Company at the right price helps us maintain a margin of safety on your investments. This allows us to generate higher capital appreciation. We use the income, market, and asset approach to evaluate the company’s valuations.
It is also made sure that the management of such companies has strong integrity, is capable and has overall good corporate governance.
Further, it is paramount that the companies are available at a reasonable valuation as compared to their earnings potential.
We focus on companies whose announcements, research and news are easily available. This helps to track the company working more closely and efficiently. This comes in handy, especially for rebalancing or restructuring of the smallcase.
Who should invest in this smallcase?
This is especially beneficial for investors who put their money into mutual funds, which invest into their large index driven funds. Companies in this smallcase are all large-cap and are strong financially. Therefore, investors who want to beat the market and don’t mind volatility can invest in this smallcase.