When it comes to the core of my portfolio I’ve only fished for quality top 200 companies, and I’ve had a bent towards good dividend payers. After all, about 50% of the overall returns from shares over time comes from dividends.
That’s why I created the Switzer Dividend Growth Fund, which has been a pretty good harvester of dividends. And with dividends on the rise because of the great handling of the Coronavirus, which has delivered a nice economic dividend for the country and profits for our listed companies and other businesses.
Switzer Dividend Growth Fund (SWTZ) dividends
But we often concentrate too much on big caps and forget small caps with potential. Personally, the bulk of my money in my SMSF is in the quality brigade, but with the collapse of the stock market I’ve made a bigger commitment to my satellite or more speculative holdings.
That’s why I bought the likes of Webjet, Flight Centre, Zip, Tyro and so on after the crash and then the huge stimulus that came from our governments and the RBA.
All this drama coincided with our innovation into holding small cap conferences, to shine the spotlight on up and coming companies. And we also do CEO Masterclass interviews [1], which have the intention to let investors hear what CEOs have to say about what their companies do and what might be the outlook/potential.
I recently asked my colleague who organises the companies for these showcases to check out how they’ve performed since the exposure.
CEO Masterclass
This table shows what has happened to the share prices of these companies since the interviews. We never recommend the companies and the CEOs know that, but we do give them a chance to talk about their business.
We’ve held four small cap events. Two were in the real world before the Coronavirus ruined our lives as we knew it, but it did force us to innovate. And we’ve done two online events, which have actually gone to a greater numbers of investors.
I’ll show you how these companies have done below.
Event 2019
One company that has zoomed higher is Novonix (NVX), as the chart below shows. The company’s connection to electric vehicle production partly explains this spike.
Novonix Ltd (NVX)
I’d never heard of NVX until they came to our conference. Then James Dunn wrote a piece on EV-related companies for this Report and my eyes were opened up.
Here are the companies that went to our events and how they have performed:
Events 2020
These companies are too small to be covered by analysts and are often ignored by other media outlets. But there are some great stories worth considering.
ELO is the only ‘bigger’ small company covered by FNArena, which says ELO has 50.4% upside, but this company needs our economy to be back to business as normal before these analyst’s ‘guesses’ are proved right.
Personally I look at these companies, get a technical assessment and see if the market trends are marrying into the real life fundamentals.
Because Novonix is engaged in batteries for the electric vehicles (EVs), which is a sector with so much potential, it’s a real target for anyone fishing for a future star performer.
However, with very small caps, you have to realise that these plays are risky, and that’s why you should make sure you don’t invest in them like they’re a core part of your holdings.
Of course, if you do, you could get huge returns but that’s when you stop being an investor and more a speculator/punter!
My suggestion is that if you want to find some future starts, then make sure you check out our future small cap conferences and read carefully our weekly stories from our small cap ‘anglers’ — Tony Featherstone and James Dunn.
They’ve had some great catches over the years. But remember, these are for your risky plays, not your core holdings.
Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regard to your circumstances.