Long Shot: An Energy-Infused Turnaround

Real Money's Long Shot column is dedicated to trading ideas that are highly risky, but which present an opportunity for significant payoff if they work. Such ideas are sometimes characterized as "lottery tickets" and are for only the most risk-tolerant investors, as the potential for 100% loss is high. 

Warren Buffett has warned that "turnarounds rarely turn," and for this reason we rarely recommend turnarounds in the Long Shot column. But turnarounds do work out on occasion, and when you have a high-conviction turnaround idea, there is no harm in allocating a small weighting to the idea. Recall that turnarounds are one of the six equity "asset classes" that Peter Lynch utilizes in his 1989 classic One Up on Wall Street. (The other five are slow growers, stalwarts, fast growers, cyclicals and asset plays.)...865 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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