Our Stock Pickers Digest newsletter helps you find the aggressive investing stocks that could greatly enhance your portfolio’s results. These undervalued, often overlooked companies have the potential to explode for large returns of 50% or more in six months or less.

It’s important to keep in mind that all aggressive investing stocks – including those we recommend in Stock Pickers Digest – expose you to a higher degree of risk than conservative selections.

However, there are many ways to cut your risk in aggressive investing and still put yourself in position for large returns. Here are three key strategies you can easily apply to the part of your portfolio you devote to aggressive investments. They form the core of the advice we give you in Stock Pickers Digest.

Aggressive investing strategy #1: Because aggressive stocks expose you to a greater risk of loss, we recommend limiting your aggressive holdings to no more than, say, 30% of your overall portfolio.

Ultimately, the percentage of your portfolio that should be held in either conservative or aggressive investments depends on your personal circumstances and risk tolerance. An investor with a longer time horizon or without the need for current income from a portfolio can invest more money in aggressive stocks. But we think 30% is a good rule of thumb.

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Aggressive investing strategy #2: Focus on investment quality when looking for aggressive stocks with the potential for large returns. When we look for aggressive investments to recommend, we zero in on companies that have established a business and have at least some history of building revenue and cash flow. We also look for companies that stand to benefit as the economy continues to improve, and have proven management and long-term growth plans.

That’s opposed to so-called concept stocks, many of which are start-ups or companies that look to profit from next week’s or next year’s investor fad. These companies can generate large returns in a good year. In the long run, though, they are likely to cost you money.

Aggressive investing strategy #3: Look for aggressive stocks with hidden value — value that attracts far less investor attention than it deserves. That gives buyers a bargain. It may also attract takeover bids.

Hidden assets can consist of real estate or underused brand names. For example, companies often carry their real-estate assets on the corporate books at its purchase price, even though its value may have multiplied many times over the years. Balance sheets often fail to assign any value to brand names, even those household names that have built up multitudes of loyal customers over the years.

Research and development spending by technology stocks is one of today’s best-hidden assets. High research and development budgets let tech stocks keep adding profitable new products to their lines and improving existing ones.

Looking for hidden value can produce large returns — and when you lose, you generally don’t lose that much.

You can get our latest analysis, including our buy/sell/hold advice, on 19 aggressive stocks in the latest Stock Pickers Digest. Click here to learn more about how you can get one month free when you subscribe now.