Everyone in the stock market has a singular dream of generating wealth. That can only come through compounding when you invest for a long time regularly.  So, 2022 can be an ideal start to long term portfolio building and what can be the best way than to build a solid portfolio of small and midcap stocks with strong potential to generate a disproportionate return with limited downside.

What is Smallcase?

Smallcases™, developed by Smallcase Technologies LLC, a fintech company launched in 2016 by three IIT Kharagpur graduates, enables investors to park their funds according to their conviction or portfolio preferences. They can either create a portfolio of their own or invest in a portfolio of stocks based on a particular theme.

In case you don’t want to invest on your own, you can do it through paid managers who charge a certain fee.

Generally, these portfolios are created by a team of analysts and have small ticket sizes, making it easier to access star portfolio managers to retail managers. Therefore, if you buy a Smallcase, that means you have bought a certain basket of stocks offered on the platform.

As of now, hundreds of baskets of stocks are managed by Smallcase platform portfolio managers.  Currently, the most popular portfolios are those run by Alok Jain’s Weekend Investing, Deepak Shenoy’s Capitalmind, Piper Serica and Windmill Capital.

However, a lot of new star portfolio managers have recently joined the platform that offers a variety of choices for retail investors. It’s to be noted that getting access to these portfolio managers were earlier impossible considering the high-ticket limit of PMS funds.  Omkara Capital is the latest entrant to this club and it’s among the most bought Smallcases within the very first month.

Why Should You Invest in Smallcase Portfolio?

A primary reason to invest via a is it can provide investors exposure to a wide variety of investment strategies without having to spend time tracking and analyzing myriad companies in those sectors. But there are differences between Smallcases and mutual funds that potential investors should understand.

Omkara  Opportunities Smallcase Review

Omkara Capital Smallcase provides an opportunity for retail investors to invest in fundamentally great stocks with a high probability of generating outsized returns in a span of 2-3 years with a good margin of safety.  These are typically the companies having underutilized capacity or capex cycle behind it. Such companies are better positioned to take advantage of the economic boom and increased demand. These companies have a strong execution track record and present a strong opportunity for growth some opportunistic ideas.

Before digging deeper, it’s always better to know a bit about the jockey—Varinder Bansal. If you happen to be a CNBC TV 18 fan, the probability is you may be knowing him already and be fully aware of his abilities as an equity researcher and journalist par excellence.

As an analyst, he has a knack for identifying not-so-fashionable stock ideas, supported by strong fundamentals, superior balance sheets and can boast of high-quality promoters. And the best part is he personally has the access to management of most of these corporate houses, thanks to his long-stint in business media that allowed him a deep-rooted connection with equity-market veterans and leaders of corporate India.

Omkara Opportunities Smallcase Review:  Investment Strategy

They like to invest in sectors with growth potential that were currently going through cyclical downturns, but the turn is just around the corner.

These companies have either moat or have commanding market share or that have a huge competitive advantage over rivals. Such businesses are poised to reap the benefits of the business cycles when it turns in their favour.

The point to consider is in an upcycle, companies with under-utilised capacities and those that have recently completed the CAPEX have the potential to make disproportionate gains. To protect our capital and to provide a margin of safety, they only buy stocks with above-average profitability, low debt, moderate growth.

They don’t believe in “Buy right and sit tight.” Rather, they monitor the performance of companies in which we have invested to sell them at the right time if the valuations touch the roof and they cannot be justified. If any of them don’t perform as per hypothesis, they sell it. The idea is your portfolio should remain aligned with performers.

Omkara Opportunities Smallcase Review: What Differentiates Them

Just 3 Words define them: Why What And Who. They don’t just tell which stock to buy but also tell the ‘WHY’. The best part is you can approach and ask the rationale behind any stock in the portfolio. Recently, I asked a question about the rationale behind a stock about which I had a doubt. I just asked on his Twitter profile in the message section, and to my surprise, he responded in detail. That gave me the confidence to be invested in the stock.

Omkara Opportunities Smallcase Review: Fee Structure

It’s very reasonable which is 2.50% annually on investment value + ₹2,065 advance fee to start a subscription.

Conclusion 

Omkara Capital Smallcase portfolio is a fine blend of both value and growth, smallcap, midcap and largecap stocks, which are well-diversified across sectors. If you are looking to generate alpha in your portfolio, it’s a no-brainer.

To know more about their investment philosophy, click here: WHO/ WHAT/ WHY Omkara – Omkara Capital Private Ltd Flip PDF | AnyFlip