In 2001, BSE had about 2,127 listed companies. Fast forward to 2025, that number has swelled past 5,600+. More choices should mean more opportunity. Instead, it has created a paradox of choice.

Finding the right company has become like finding a needle in a haystack.

Mutual funds were born to solve this complexity. Investors could hand over their money to professionals and avoid the hard work of picking stocks individually. But success breeds competition. In 2006, there were ~592 mutual fund schemes; today, there are 1,700+. The problem simply shifted from picking the right stock to picking the right fund.

Smallcases arrived in 2016, curated stock baskets, and were investable in one click. But as they grew popular, they multiplied. Now, 500+ Smallcase baskets by 200+ RIAs.

So, how do you, as a common investor, find clarity in building wealth in a market full of noise?

The best way to answer: What can go wrong? We can assure that you can’t make the right decision by simply doing a textbook analysis, looking at past returns, or studying risk-return graphs.

When you pick stocks directly yourself, three truths surface.

• It consumes time. Between balance sheets, market news, and earnings calls, stock picking demands more hours than most day jobs.
• The learning curve is steep. Markets are brutal teachers, and it takes decades of consistent study, mistakes, and refinement.
• The return on effort is often underwhelming. Spend months researching and invest ₹1 lakh, an index fund may return 12%, while beating it with 15% usually happens only in easy bull markets, rarely in tough ones.

Is the extra ₹3,000 worth hundreds of hours? Probably not.

The harsh truth is that direct investing rarely justifies the effort with small capital.

If direct investing feels complex, mutual funds seem like the opposite: simple, efficient, and professionally managed. But here’s the reality: it’s investors who control the timing. When markets crash, retail investors panic and redeem, while fund managers are forced to sell at low prices.

During the COVID-19 crash, Parag Parikh Flexi Cap Fund’s (formerly known as long-term equity fund) AUM fell from ₹2,794 Cr. to ₹2,448 Cr. in just March 2020, because investors panicked and pulled money out.

At the same time, regulations mandate staying 70–80% invested in equity, even when markets are at their peak. Fund managers are compelled to buy at overvalued levels, and your returns depend not just on the market but also on the behaviour of other investors.

There’s another hidden flaw: lack of transparency.

You don’t see the thinking behind a portfolio. Fund managers don’t disclose why they picked a stock or how their thesis evolves. You invest, but you don’t learn from them.

For curious investors, it’s a frustrating black box.

Now, let’s turn to Smallcases, a newer innovation in equity investing.

Many ask,“Why isn’t Finology available as a Smallcase?”

Fair question.

We were among the earliest publishers and tried it for a few months. Smallcases offers curated baskets you can buy with one click, but there were limitations we couldn’t ignore.

When we recommend stocks in Finology 30, our research guides investors with a“Max Buy Price.” If a stock we recommended at ₹100 moves to ₹180 and our research reveals it’s overvalued, we advise new investors to wait.
Existing investors should hold, not exit.

Smallcase doesn’t allow this. Either the stock stays and everyone buys at inflated prices, or we rebalance and force out existing investors, too. It’s a binary choice: Buy or Sell.

There’s another problem: frictionlessness. Smallcase makes trading effortless, with one click to rebalance.

Sounds convenient, but easy trading fuels impulse. The brokerage earns, the government collects taxes, and the investor loses.

Inconvenience protects you from bad decisions. Without it, Smallcases risk turning disciplined investors into frequent traders.

Assisted investing via model portfolios, research reports, or advisors offers a blend of tailored advice, professional insights, and personal control.

But trust and transparency are the main challenges. The market is flooded with unregistered advisors masquerading as SEBI-registered, promising 50% returns with manipulated track records & testimonials.

Real advisors admit markets are uncertain, consistent outperformance is rare, and patience beats prediction.

The good news: Platforms like smallcase filter out fraudsters, allowing only SEBI-registered entities.

With a credible advisor, assisted investing opens a new world of direct access to research, deeper control over your portfolio, and freedom to adjust allocations.
Don’t like a stock? Skip it.

Conviction high? Increase it.

It’s a middle ground between mutual funds and DIY investing.

Conclusion

You have three broad paths to choose from:

• DIY — direct stock picking
• Managed — mutual funds or Smallcases
• Assisted investing — guided research and advisory services.

If you can invest 2–4 hours a week, DIY is the best long-term strategy because it guarantees competitive returns with zero fees. Early on, you might underperform mutual funds, but you will get something more valuable: superior instinct.

Reading annual reports and studying industry changes, and how macroeconomic events affect companies.

If you’re too busy with work, family, or health, mutual funds are your best bet for professional management, SIP automation, and peace of mind.

Smallcases offer curated portfolios without the heavy lifting like in DIY, though flexibility is limited, and here also, you don’t get to learn anything.

Assisted investing sits slightly higher on the control-insight ladder. You get research reports and understand why a stock is picked, not just which one. You learn, adjust, and gradually sharpen your instincts.

Of course, there’s a cost. If the advisory fee is ₹12,000 and you’re investing ₹1 lakh, that’s a steep 12%. Assisted investing can be a backdoor to DIY. You start with expert guidance, and over time, as you follow research and manage allocations, you find yourself ready to go fully independent to manage significant capital that financial rewards meaningfully in the longer term.

It’s the bridge that transitions you from a passive investor to an active stock market participant.

Finology is a SEBI-registered investment advisor firm with registration number: INA000012218.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.