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Largecap: The Pillar of An Investor Portfolio – By Sidhavelayutham, Founder & CEO, Alice Blue
Bangalore (Karnataka) [India], January 31: Investors should always remember that portfolio risk management is as essential as striving to meet the return objective. There are more than 5000 stocks listed […]
Bangalore (Karnataka) [India], January 31: Investors should always remember that portfolio risk management is as essential as striving to meet the return objective. There are more than 5000 stocks listed in the Indian stock market. It is a huge collection of a lot of microcaps, a few smallcaps, some more midcaps and a handful of largecaps.
Currently, there are a lot of investors who might be thinking that there is no evident benefit of investing in largecap stocks as the smallcap and midcap stocks are hitting through the roof and becoming multibaggers by giving double or even triple digit returns in a span of months.
In this kind of return environment, it is very important to understand and recall the concept of volatility. Smallcaps and midcaps have comparatively much higher volatility against largecaps. If there is a black swan event in the world such as a war or a global epidemic, the largecaps will be the one to balance out investors’ losses in other stocks during market fall.
