Some time ago, I launched my first ever personal basket of stocks called “Stef’s Super Spicy 25.” I launched this particular basket because, at the time, small cap stocks were getting absolutely smashed, and I felt there was opportunity to explore this area. While that sell off did persist for some time, I still feel like the same thing holds true:
There are interesting opportunities out there if you’re willing to look hard enough.
Today, with the resurgence of small caps, I still feel the same way and now I am updating my list. But, before I get to the updated list, here’s what I wrote when I first launched Stef’s Super Spicy 25:
“I have been tweeting about the intense divergence between individual stocks and the broader indexes. What I mean is, while the S&P 500 might be up 8% over the last year, the average stock is doing a lot worse than that. I mean, a lot worse. There are hundreds, wait actually thousands, of stocks that have been totally thrashed, smashed, and crashed.
• 2000+ stocks that are down 40% of more in the last 12 months.
• Several hundreds stocks that are down 75% or more over the last 12 months.
• But the indices keep going higher”
I think it’s rather interesting to look at that quote above, what happened after, and now think about what’s going on today. For example, this just happened:
And also this:
Updating The List (Draft #2)
Today, it’s time to the update the list. Please keep in mind this is only for entertainment and education. It is also not official. I call this draft #2 and so there is more work to be done and at some point, I’ll finalize it. I sure did learn a lot since I published the last list! Without further ado, here’s the updated list whereby I’ve removed several stocks and added new ones:
LegalZoom – LZ
Bandwidth – BAND
TrueCar – TRUE
Purple – PRPL
Nerd Wallet – NRDS
Expensify – EXFY
Redfin – RDFN
Rivian – RIVN
Mannkind – MNKD
Stone – STNE
Purple – PRPL
Alpha Pro Tech – APT
Lakeland – LAKE
Allbirds – BIRD
Vimeo – VMEO
SunRun – RUN
Daktronics – DAKT
iRobot – IRBT
UpWork – UPWK
Toast – TOST
Limoneara – LMNR
Wix – WIX
DLocal – DLO
FormFactor – FORM
Revolv – RVLV
Desktop Metal – DM
REMINDER ☝️
This is still only a second draft, intended solely for educational and entertainment purposes, and for reviewing some facts and statistics about markets. Please note that I am not a financial advisor. Always do your own research and due diligence.
I hope you enjoyed this post and if you want to read more, I’ll revisit one more thing I wrote about Stef’s Super Spicy 25 back when I first launched the list almost 2 years ago and when small caps were getting destroyed. Here are the parameters I used to source each stock:
“And so that got me thinking, as someone who likes to trade: where’s the opportunity? I created a list of stocks that I personally went through and made my own watchlist for. I am calling it “Stef’s Super Spicy 25” because the list is hot, tasty, but also dangerous. Hot peppers make your food taste great, but have too much or the wrong one and you might get burned bad. This list is the same. The parameters for selection were pretty simple: down 60% or more over the last 12 months, a recognizable brand, a balance sheet that’s sturdy, and the potential to flip the switch on free cash flow.”