Mumbai, Maharashtra (UNA) :
Small-cap stocks in India saw widespread declines as nearly 90 % of shares fell by 10 % or more in recent sessions, underperforming larger indices such as the Sensex and Nifty. This broad weakness in smaller companies highlights rising investor caution, especially in riskier parts of the equity market, amid uncertainty in global policy and domestic trading conditions.
For everyday investors and savers with exposure to small-cap funds or stocks, this trend may translate into short-term losses. Small-cap shares are generally more volatile than large-cap counterparts because they tend to have lower trading volumes and can be more sensitive to shifts in investor sentiment. During periods of market caution, riskier assets often see sharper sell-offs.
Analysts said that the recent underperformance reflects a combination of profit-taking after earlier gains and heightened focus on more defensive sectors. When broader market sentiment turns cautious, some investors move capital away from smaller companies and toward larger, more established names or safer asset classes.
The double-digit declines also underline the importance of diversification and long-term planning for individuals investing in equities. Financial advisers often stress that small-cap segments can offer growth over time but may experience sharper swings in the near term.
Officials and investment experts emphasised that market corrections are normal parts of investment cycles. They advised that long-term investors stick with well-structured strategies tailored to their risk tolerance and financial goals, rather than reacting to short-term price movements alone.