These 5 Smallcaps Deserve a Place in Your Coffee Can Portfolio

Jul 28, 2020

Richa Agarwal, Research analyst

It's been a few months since I wrote to you about an urgent opportunity in smallcaps...in 5 smallcaps to be precise.

May 2020 wasn't the best of the times to talk about investing in smallcaps...except in hindsight.

Ever since the market regulator came up with the mutual fund reclassification, in 2018, smallcaps have taken a hit from which they are yet to fully recover.

With Covid and the lockdown, the road to recovery felt even longer, and full of uncertainty.

The consensus was to do nothing and wait.

I would say that was the right thing to do in most cases. The exceptions were a small group of essential businesses which seemed to be relevant and 'in work' despite the economy coming to a standstill.

It needed perspective, patience and guts.

--- Advertisement ---
Here's an urgent profit opportunity from us that no mainstream media is revealing...

The #1 Stock for 2021.

...An innovative stock with the industry giants chasing it for its technology to touch millions and millions of people every day.

It serves several clients across the globe, but what got me is this...

The stock is leaving all its competitors behind despite the COVID crash, and now the price has already started to move.

There's actually one more reason why this stock could take off and make its early investors rich.

It's revealed here in this note with transparency.
------------------------------

And I'm happy to say, we did not let the crisis go waste. While we were confident of the long- term story in these stocks, we also believed the first 50%-100% stocks could come in very fast...and asked our readers to act urgently.

Yes, there was a bit of luck here - the markets were on our side.

But as they say...luck is what happens when preparation meets opportunity.

It is heartening to see the effort pay off well. Every single smallcap in the list has offered gains, beating the benchmark indices by a handsome margin.


But even if the gains had not come, my conviction in these 'Essential stocks' would not have been any less.

That's because these are coffee can stocks.

--- Advertisement ---
Going Live on 30th September 6pm To Answer A Burning Question

Economies across the globe have collapsed.

However, despite all the weak economic data, the stock markets have rallied.

But how sustainable is this rally?

The burning question of the hour is

"Where are the Stock Markets Headed?"

And that is exactly where our upcoming live and exclusive free webinar will help you.

Join Nilesh Shetty, Associate Fund Manager, Equity Funds and I.V. Subramaniam, Director, Quantum AMC LIVE as they address your most pressing concerns...and try and fulfill your need for the next big investment opportunity.

If you are a serious investor, you cannot afford to miss this opportunity.

Register FREE for this upcoming webinar in 1-click
[Yes! I want to attend this Exclusive Webinar]


Yes, also send me your financial planning newsletter, Quantum Direct, free of charge.

Date: 30th Sept. | Time: 6pm | Venue: Your Computer
------------------------------

While the term is quite popular these days, its origin is equally interesting.

It goes back to the old times, when people used to put their valuable assets in a coffee can and kept it under their bed.

This involves taking no action post buying and no transaction costs. What went into the coffee can determined how valuable it would be, years down the line.

Now this may sound passive but remember, investing is one of those fields where sometimes, doing less is more, especially with quality stocks. This is because it lets your money compound with time.

The idea first occurred to Mr Robert Kirby, a professional money manager in 1950s, as a result of his experience with a woman client.

Mr Kirby had worked with her for almost 10 years. When the client's husband died, the wife inherited his wealth and called Mr Kirby to add his securities to her own portfolio under Mr Kirby's management.

Mr Kirby saw the husband's portfolio. He was amused to find that husband had been secretly copying Kirby's recommendations for the wife's portfolio in his own. However, he did so with a little twist.

He only copied buy calls and ignored the 'Sell' views. When Mr Kirby looked at the portfolio, it seemed odd.

UNLOCKED: Up to 3x More Gains During the Corona Crisis...

Some were big winners, up 20 times. Some were losers (down 50% or so), and one jumbo winner in a small company that exceeded his wife's portfolio. By ignoring his sell calls, the husband had outshined Mr Kirby.

In my video below, I'll tell you why having a long-term horizon helps to not just navigate volatility well but maximize returns too.

The key is what you are putting in the can. It also helps you to align your stock selection process, turning it from speculation to a real investment process.

What gives us the conviction in our bets is the long-term mindset and the right process. Amid huge uncertainty, be it markets or economy, we are focused on the long term and sustainable businesses.

I hope you had the chance to act on these essential smallcaps. They could be considered for the long term.

In case you did not, some of these stocks are still in the buying range...and offer strong upside in the long term. Hidden Treasure subscribers can read the report here.

Warm regards,

Richa Agarwal
Richa Agarwal
Editor, Hidden Treasure
Equitymaster Agora Research Private Limited (Research Analyst)

PS: Get access to my 5 essential smallcaps recommendation report by signing up here.

Recent Articles

It's When You Sell that Counts September 25, 2020
How I alerted readers to the impending crash last week.
What to Do if there is a Second Wave of the Stock Market Crash September 24, 2020
Here's what I think investors should do in this selloff.
I Believe These Stocks Will Deliver the Most Outsized Returns in 2021 and Beyond September 23, 2020
Rules of the racetrack can help you bag the biggest gainers of the coming decade.
My Top Stock to Buy in this Market Selloff September 22, 2020
The recent correction offers a great opportunity to buy this high conviction smallcap stock.

Equitymaster requests your view! Post a comment on "These 5 Smallcaps Deserve a Place in Your Coffee Can Portfolio". Click here!

5 Responses to "These 5 Smallcaps Deserve a Place in Your Coffee Can Portfolio"

Sunil Acharya

Aug 15, 2020

Ok

Like 

Pradeep

Aug 12, 2020

I,m was a subscriber for hidden treasure.
Kindly enlighten on ideas to generate regular stream of cash from the markets.

Thanks
With kind regards
Dr Pradeep Kumar

Like 

S K Beecham

Aug 10, 2020

Very good

Like (1)

a n banerjee

Jul 31, 2020

I agree with Mr Deepak - limit your write ups - give tips directly which will benefit and for which we have become member by making payment - regards

Like (2)

Deepak

Jul 30, 2020

Richa and Tanushree,

I do admire your skill but suggest you to limit long pages. Just limit the scope to stocks which you feel are better and your study.

FYI : I will not agree with your all stock recommendation however I do admire your effort to streamline the stock but suggest it to be limited to your skills only.

Best Wishes,
Deepak

Like (2)
  
Equitymaster requests your view! Post a comment on "These 5 Smallcaps Deserve a Place in Your Coffee Can Portfolio". Click here!