One of my first jobs was as a horse racing handicapper. At each racetrack, you would receive a program listing all the horses and their stats for each race, along with write-ups on the horses. I wrote those write-ups. I studied the stats, watched video replays, and became quite skilled at handicapping, which led me to think, why not own horses? After all, you could bet on your own horse and win both your wager and the purse. It sounded so easy—but in reality, it was anything but.

Owning a stable is a tricky business, and I try to build my stock portfolio using many of the lessons I learned from those days. With every horse you own, there are fixed monthly costs—primarily training expenses, which cover stall fees, feed, and trainer fees. On top of that, there are additional costs, such as vitamins, medications, transportation, registration fees, and staking. Ownership is expensive, so it’s crucial to have racehorses that generate enough winnings to at least cover their costs.

The challenge is that horses need rest, they don’t always perform consistently, they get injured, and they’re overall quite complex animals. When a horse is in peak form, that’s your earning window, and you want to ensure it’s properly classified to maximize its potential earnings. Occasionally, you’ll get a horse that can compete in stakes races for much higher purses, but those are rare. For the most part, your horses will run in overnight races, which provide more frequent but lower-paying opportunities.

Here’s the reality: horses age. Most reach their peak between the ages of three and five, and while some can race until they’re eight to ten and beyond, they won’t be anywhere near their prime. As an owner, you need to recognize this and sell your horses at their peak to maximize their value—otherwise, their worth declines as they get older. And then there’s another harsh truth: some horses are simply duds. They may have an impressive pedigree and look great on paper, but they never figure out the game and end up being a financial drain. The best strategy is to cut your losses early before one bad investment drags down the rest of the stable.

Building a successful stable requires careful planning. The bulk of your resources should be allocated to racehorses that are actively competing, in peak form, and generating enough prize money to sustain the rest of the stable. However, you also need to invest in young prospects—yearlings and developing horses that aren’t ready to race yet but have the potential to become future champions. Some of these horses will rise to the top, while others may never reach their full potential.

I take the same approach with my stock portfolio. My top-performing stocks (“top dogs”) are the ones with expanding multiples, actively driving returns. Alongside them, I hold a smaller basket of high-potential microcap stocks (“yearlings”)—stocks that show promise but are still in the early stages of growth or a catalyst away from becoming a top dog. While this portion of my portfolio is smaller, the goal is for these emerging stocks to develop into future leaders over the next couple of years. When that happens, I’ll need to replenish the farm team, continuously cycling in new opportunities to maintain long-term growth.

My yearling portfolio isn’t just made up of new listings or startup companies. Some of these stocks have been around for 20+ years and are finally showing signs of reaching a long-awaited inflection point. Others may be former top dogs that fell from grace but are now showing signs of a turnaround. Some are purely speculative plays, where the value lies in the potential for a new company to be vended into the stock by its owners, creating an opportunity for appreciation. Ultimately, this portion of my portfolio is a diverse mix of companies, each with a potential catalyst event on the horizon.

I’ve shared these names before, but here’s my write-up on my current basket of “yearlings”, along with their morning line odds:

Novra Technologies Inc. ($NVI.V) ($NVRVF) – 9/5: This veteran has been racing in the bottom ranks for a while, picking up the occasional check. Recently, a new ownership group took notice and is hoping to get him back in top form.
My analysis can be read here.

Yangaroo Inc. ($YOO.V) – 5/1: Has had some bad luck racing against tougher competition but has recently shown signs of improvement. Could be ready to start performing better.

Vibe Growth Corporation ($VIBE.C) – 4/1: A former perennial favorite that has been stuck in a prolonged slump. With too much back class to be competing at these levels, a turnaround could be in the cards.

Atmofizer Technologies Inc. ($ATMO.C) – 8/1: This expensive yearling has been a disappointment since day one. However, strong connections could still turn him into something worthwhile.

Network Media Group Inc. ($NTE.V) – 10/1: An unpredictable performer—when he’s on, he looks great, but those standout performances have been too few and far between. Needs to show more consistency.

Belgravia Capital Intl ($BLGV.C) – 12/1: Recently transferred to a new trainer, who plans to implement a rigorous training program. It’ll be interesting to see how he responds. A longshot, but worth watching.

Over the coming weeks, I’ll be sharing my analysis on each of these stocks.