Research and buy the right companies, have patience and your portfolio can do amazing things
I now hold the view:
- 4-8 speculative growth holdings
- good-sized positions in each (big enough that each could be life-changing if they 5-10 bag, although also look for companies with greater potential)
- have the patience for management to execute their strategy ( be prepared for multi-year holds - periods like 3+, 5+, 10+ years)
Start with a crystal ball and think about where a company will be in 3-5 years. Do the work to come up with assumptions that support speculation on future production and cashflow ( for mining companies guesstimates on size of resource, life of mine, how many years for studies, how much dilution ). If this is too hard, find other companies to invest in - historic drill results, historic JORCs, exploration targets are a good start.
Have done this very effectively for ADN and NVA.
For Biotechs it is working out size of market or peer comparisons and how much time and importantly probability to achieve a value inflection point.
