smallcases are reviewed & updated on a regular basis. You can see the next expected update date on the smallcase page under the Stocks & Weights tab
This is done to ensure the stocks & weights in the smallcase continue to reflect the underlying theme and model
When a smallcase you hold has been rebalanced, you receive a Rebalance Update notification for the same via e-mail
You can now see the changes made by the update - the stocks being bought, the stocks being sold, the stocks remaining unchanged
After reviewing the changes, you can apply the update, edit the update and then choose to apply it or ignore the update
If you wish not to sell a particular stock, you can edit the update by using the Edit changes option as below,
If you do not rebalance your smallcase with the update, your smallcase holdings, composition & returns may vary from the original. Also, your smallcase will not reflect the underlying theme/model as intended
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 and 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 keep up with the theme they’re intended to follow.
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 rebalance update is available for your smallcase, you would need to apply it manually in 2 clicks.