Hidden gem is a service that finds and offers small-cap stocks with enormous growth potential – with returns of hundreds or even thousands of percent over the long term.
Richa Agarwal, editor of Hidden gem has traveled across the country hunting for small caps with strong return potential.
What was our “big picture” idea behind starting this service solely for selecting small cap stocks?
We’ve seen that the small cap universe was a relatively underexplored space.
Trading in this space without enough information has burned many a finger. At the same time, it would not be wise to avoid this space altogether as it provides the opportunity for multi-bag returns. All one needs to access is a thorough research process and information to analyze the companies in this space.
We have a specialized team dedicated to researching small cap stocks with high potential. What the team is essentially looking for are companies with stable and sustainable business models that have long-term growth prospects, a sustainable competitive advantage over the competition and, last but not least, good quality management.
Over the years we have continually refined and strengthened our research process. Although small cap stocks are inherently riskier than blue chip stocks, we have developed our own screeners and filters that help us eliminate highly risky small cap stocks. Our mantra is to find and recommend profitable long-term opportunities in the small cap sector, without taking unnecessary risks.
The Hidden Treasure team communicates with dozens of company management through in-person meetings and virtual calls. This is then followed by a careful study of the company’s future growth prospects, profit margins, return on capital and valuations. Only those stocks that prove to be the best – both from a business and valuation perspective – are recommended to the subscribers. Furthermore, our proprietary tool, the Equitymaster Risk Matrix (ERMTM), is used for an objective and thorough risk analysis of small-cap companies.
What does Hidden Treasure offer?
Through Hidden Treasure, we aim to provide an exclusive one-stop research service dedicated to researching and providing independent and unbiased opinions on high-potential small-cap stocks.
The Hidden Treasure team will provide a detailed recommendation report on or before the 15th of each month that includes the following:
- One new advice with detailed analysis and valuation
- Latest insights and updates on existing recommendations
- The third part is the list of stocks that we believe are the most attractive, both from a valuation and risk perspective.
Our subscribers are therefore entitled to at least 12 recommendation reports annually.
In addition to these features, we provide quarterly earnings updates for small-cap stocks covered, as well as special reports based on specific events that could have a material impact on the company’s fundamentals.
In short, the Hidden Treasure service aims to discover small cap stocks with high potential and provide our subscribers with regular overviews and updates throughout the recommendation period.
Please view a sample report for Hidden gem.
What Hidden Treasure doesn’t offer
Hidden Treasure is a general recommendation service. We do not provide an opinion tailored to any particular subscriber or class of subscribers. We are not a qualified financial advisor or investment advisor and we strongly advise our subscribers to obtain professional advice before making any decisions about their investments.
Who is the editor of Hidden Treasure?
Richa Agarwal, editor of Hidden gemhas ten years of experience as an equity research analyst. She routinely scours the small-cap universe for fundamentally strong companies trading at attractive prices.
Richa’s favorite aspect of her job is the interactions with management. She has traveled thousands of miles in search of new investment ideas for Equitymaster subscribers.
Having degrees in both finance and engineering has served her well in analyzing business models in the small cap space. Richa is also editor of the extremely exclusive service, Phase one warning.
What is the stock selection process?
Richa and her team contact the management of dozens of companies every year. And this is after studying the details of hundreds of small businesses. The team continually scours the small-cap universe for fundamentally strong companies trading at attractive prices. What the team is looking for is companies with stable and sustainable business models that have a view of long-term growth, a sustainable competitive advantage over the competition, good quality management and, last but not least, attractive valuations.
What could be the expected returns and how will Hidden Treasure’s performance be measured?
The Hidden Treasure services are intended to recommend small cap companies that have wealth creation potential. The goal is to select stocks that have the potential to deliver compound annual returns that easily exceed those of the benchmark index over a three- to five-year period. While we cannot guarantee returns, we aim to do our best to recommend stocks with strong return potential.
That said, stock returns are subject to market risk, and since small cap stocks are extremely vulnerable to market risk, there have been instances where the recommendations have suffered losses.
Here’s something our subscribers have to say about their experiences with Hidden gem…
What should be the term of the investment?
In line with our investment philosophy, our investment horizon Hidden gem recommendations is approximately 3 to 5 years.
Where hidden treasures fit…
Stock markets are generally very volatile. And putting too much money into one stock or sector can be very risky. Small-cap stocks are inherently riskier compared to large blue-chip or mid-cap stocks. On the plus side, they offer enormous growth potential. It’s not unusual for a good small-cap stock to become a multibagger within a few months. But on the other hand, there is a big risk involved. We’ve even seen small cap stocks plummet 80 to 90% when things go wrong.
In our view, small cap stocks should not represent more than 10% of the total equity portfolio. Furthermore, we believe that a single small cap stock should not represent more than 2-3% of the total portfolioPlease note that this allocation varies from person to person. For something that works best for you, we recommend talking to your investment advisor.
What are Hidden gem Subscribers say?
Before joining Hidden Treasure, I looked at a flood of investment advice from various sources like Money Control, ICICI-Direct etc. I based my investment decisions on these recommendations. Hidden Treasure’s subscription price was attractive and the actionable recommendations came at an easy-to-manage monthly interval. Six to seven of the recommendations were a success. These are acceptable odds for me. Good value for money. The Hidden Treasure team provides excellent work and service to the subscribers. My compliments to the team.
– Mohammed R Khan, Chennai
I had never invested in shares before. I subscribed to Hidden Treasure to explore the great untapped potential in small cap stocks. I invested the same amount in all Hidden Treasure recommendations. I made early gains on some stocks. I learned a disciplined approach to investing from Hidden Treasure.
– Nitin Rane, Dahanu
Read more subscriber reviews.
I want to know more about Hidden Treasure. How should I proceed?
You can write to us with all your questions, we will be happy to help you. You can also call us at +91-22-61434055, Monday to Saturday between 10am and 6pm.
How can I try Hidden Treasure?
We are happy to announce that you can try Hidden Treasure completely risk-free! There is a 30 day money back guarantee. So if it turns out you don’t like Hidden Treasure, we’ll be happy to refund every rupee you paid.
Or call us: +91-9136015013
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