Just released: May's high-risk, high-reward stock recommendation [PREMIUM PICKS]

Just released: May’s high-risk, high-reward stock recommendation [PREMIUM PICKS]

Fire ideas will tend to be more adventurous and are designed for investors who can stomach a bit more volatility.

Mark Rogers ❯

As the Head of The Motley Fool’s UK Investing Team, Mark approaches the stock market with the same old-fashioned business instincts and values that he honed growing up around the family business. An investor for 20 years, Mark specialises in unearthing top-quality under-the-radar investments in the small-cap market. He currently serves as Director of Investing for Motley Fool UK services and Managing Director of Motley Fool UK.

Published 17 May, 2023 6:47 am BST

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Investors following the Fire style are accepting higher risk with the goal of attaining higher returns over time. So this approach requires a higher risk tolerance, and the willingness to accept significant volatility in share prices. In October 2019, we also expanded the range of our Fire shares to also include potential recommendations from the US stock market, which tends to include a better variety of “growth” stocks.

We suggest that investors that primarily buy Fire shares should be particularly mindful of diversification in their portfolios. With sufficient diversification investors should still be able benefit from any upside, while limiting the damage to their portfolio when situations don’t turn out as we hoped.

We don’t consider Fire investing to be gambling or a get-rich-quick scheme, though. We aim to be long-term owners of these businesses and reap the rewards from their success. Our investing time horizon for these shares is measured in years and decades, not weeks and months.