stocks: When smaller stocks get big, margin of safety should get bigger, too

stocks: When smaller stocks get big, margin of safety should get bigger, too

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After a decline for five years, foreign portfolio investors (FPIs) have increased holding in midcap stocks to 16%, a year-to-date gain of 175 basis points, the data compiled by Goldman Sachs shows.

Synopsis

This is nearly eight percentage points higher than the long-term average ratio. The ratio has increased over the past three years from 29% at the end of December 2020

ET Intelligence Group: The small is getting larger in the current leg of the market rally. The combined market capitalisation of the NSE Small Cap 100 and the NSE Midcap indices has reached a decade high 39% of the benchmark Nifty 50 market value according to the data from Bloomberg. This is nearly eight percentage points higher than the long-term average ratio. The ratio has increased over the past three years from 29% at the end of December

BY

ET Bureau

3 mins read, Last Updated:

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