Every smallcase is reviewed & updated on a regular basis (mostly quarterly) to ensure the constituents of the smallcase continue to reflect the underlying idea/strategy.
During rebalancing, the constituents of the smallcase and the weighting scheme are revised as per the underlying idea/strategy.
Rebalance updates aren't applied automatically. When a smallcase you hold is rebalanced, you receive a rebalance update with which you can view and apply the changes made & update your smallcase (by buying/selling the required stocks) in 2 clicks.
You can also edit the changes before applying the update or skip the update altogether.
When a smallcase you hold has been rebalanced, you receive a Rebalance Update notification for the same via e-mail.
Should I rebalance my smallcase?
When you receive a rebalancing update for a smallcase, you can choose to apply the update or ignore it
The update is issued to make changes to your smallcase to ensure that the stocks are in accordance with the theme. If you choose to ignore it, the current stocks and weights will be retained
However, please note that some of the stocks in the smallcase may no longer follow the intended theme if you ignore the rebalance update
Will created & customized smallcases receive rebalance updates?
Created and customized smallcases would not receive rebalance updates.
The smallcases created by the research team are rebalanced in order to ensure that the constituents are aligned with the underlying idea.
So, if you create your own smallcase by picking stocks and assigning weights to them or customize your smallcase by altering the stocks & weights, you will have to monitor your smallcase and rebalance it from time to time.
Is rebalancing automatic?
Rebalancing is not automatic. When a smallcase you hold is rebalanced, you can review the changes and confirm applying the update in 2 clicks.