Back in 1997, Havells was a largely unknown company in the electrical goods space.Had someone invested Rs 10,000 in Havells in 1997, it would be worth Rs 3.50 crore today. Of course, that would have been hard to envisage back in 1997 but that is what mid-cap stories are all about. You buy them for big returns when they eventually transform into large caps. Over the last 25 years, we have seen stocks like Lupin, Eicher, TTK Prestige, Avanti Feeds, Ajanta Pharma etc create big value as they transformed from small caps into mid cap and then into large caps.
However, if you had stayed invested in mid caps through 2018, you would have realized the risks of mid-cap stocks. In a year when the Nifty was up by 4 per cent, the mid-caps were down by 16 per cent and the small caps were down by 26 per cent. But the individual damage to most stocks was in excess of 50 per cent. How do you reconcile this dichotomy between the returns potential and the risk of mid-cap stocks?
Use this 10-point checklist to monitor your mid-cap portfolio in a smart and systematic
manner.
The Article has been authored by Mr Amarjeet Maurya (AVP – Mid Caps, Angel
Broking),& the article appeared on 11th March, 2019 on the following website –
www.business-standard.com.
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