Andy's Angle Speculative Portfolio 1.0

As we alluded to in our last piece, we have two new portfolios coming for readers as we head into 2024, the first of which being our "Andy's Angle Speculative Portfolio" that will include higher risk value picks that will carry higher returns.

This portfolio will include stocks that may be facing numerous headwinds, leading to a depreciated stock price, which is exactly where a value investor wants to investigate and see if there is a substantial opportunity for gain.

So what will we look for in stocks for this portfolio?

1. Strong Fundamentals

At the end of the day this is still under our larger umbrella of value investing, and as a result, fundamentals will be at the forefront of our stock picking for this portfolio.

As usual we will be looking for stocks following our two-pronged strategy:

Undervalued Industries -> Undervalued Companies

Using this formula we have been able to find premier value stocks for our flagship portfolio and we have no doubt that that success will carry over to our speculative portfolio.

2. Growth

Here's where things begin to differ between the portfolios.

In this portfolio we will be looking for companies that are not only undervalued with their current business, but are also expected to expand and grow into stronger companies as time passes.

Whereas in our flagship portfolio we may be content with stable revenues and overall company health, in this portfolio we will be looking for companies with more aggressive financial growth, albeit at the expense of complete health and safety of the company.

3. Risk

At the end of the day this portfolio will be heavily focused on speculation, and as a result, we are almost hunting for risk.

Things like leveraged companies, highly cyclical industries and radical management are some of the criterias that fall under this category.

For example, companies that may be carrying tons of debt may not be able to make it through our screening process for our main portfolio, but in our speculative portfolio they may be able to squeak by enough to be considered. Often times we steer away from small, highly-levered companies as its usually a slippery slope most companies can't escape, but in this case we will give companies the benefit of the doubt and assess the growth potential the leverage provides.

With that being said, this portfolio will naturally carry more risk and we expect returns to be highly volatile... fair warning for our more risk-averse readers.

Without further ado, let's get into our very first pick for the Andy's Angle Speculative Portfolio...