Generally speaking the aim of active stock picking is to find companies that provide returns that are superior to the market average. And in our experience, buying the right stocks can give your wealth a significant boost. For example, the Auriant Mining AB (publ) (STO:AUR) share price is up 96% in the last 5 years, clearly besting the market decline of around 8.6% (ignoring dividends). However, more recent returns haven’t been as impressive as that, with the stock returning just 76% in the last year.
Auriant Mining wasn’t profitable in the last twelve months, it is unlikely we’ll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best