Aggressive investing is an investing strategy that can yield high returns – but also entails taking on a lot of risk. An investment strategy that involves aggressive investing is only suitable for investors who can accept substantial risk, and the chance of losses.

The most common form of aggressive investing is to put a large part of your portfolio in stocks (or mutual funds) of less well-established companies without a history of earnings or dividends. Aggressive stocks don’t have the secure hold on the growing, or at least stable, clientele that conservative stocks have. When something goes wrong with aggressive investments, there is great risk of serious, if not total, loss.

We feel that the best investing strategy for most people is to hold the bulk of their investment portfolios in securities from well-established companies. All these stocks should offer good “value” – that is, they should trade at reasonable multiples of earnings, cash flow, book value and so on. Ideally, they should also have above-average growth prospects when compared to alternative investments.

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CIMAREX ENERGY $30.94 (New York symbol XEC; SI Rating: Extra Risk) (303-295-3995; www.cimarex.com; Shares outstanding: 83.3 million; Market cap: $2.6 billion) is an oil and gas explorer and producer that mainly operates in the U.S. Natural gas makes up 69% of its production. Cimarex has properties in western Oklahoma; Kansas; the upper Gulf Coast regions of Texas and southern Louisiana; the Permian Basin area of western Texas; and the Gulf of Mexico. The company’s natural-gas production averaged 489 million cubic feet equivalent per day in the latest quarter, up 3% from a year earlier....

DEVON ENERGY CORP. $61.81 (New York symbol DVN; SI Rating: Speculative) (405-235-3611; www.devonenergy.com; Shares outstanding: 443.9 million; Market cap: $27.4 billion) is one of the largest independent U.S.-based oil and gas explorers and producers. Its production mix is about 66% gas and 34% oil. Devon’s properties are mainly located in the United States and Canada. Aside from conventional production, they include shale oil in northern Texas, oil sands in Canada and deep-water wells in the Gulf of Mexico. In the three months ended March 31, 2009, Devon’s cash flow fell 60.8%, to $959 million, or $2.16 a share, from $2.4 billion, or $5.50 a share. The sharp drop was the result of lower oil and gas prices....

INTERNATIONAL ROAD DYNAMICS $1.25 (Toronto symbol IRD; SI Rating: Speculative) (306-653-6600; www.ird.ca; Shares outstanding: 14 million; Market cap: $17.4 million) is a highway traffic management technology company that specializes in supplying products and systems to the global intelligent transportation systems industry. These include automated toll-road systems, automated truck weigh station systems, WIM (Weigh-in-Motion) systems, advanced traffic control, driver-management systems and data-collection systems. In addition to products and systems, International Road Dynamics also provides long-term service and maintenance. International Road is based in Saskatchewan, but has sales and service offices throughout the United States and overseas. Private corporations, transportation agencies and highway authorities around the world use International Road’s products and systems to manage and protect their highway infrastructures....

Investors are interested in wind power stocks, solar power stocks and other green stocks because they like the idea of making money and helping the environment. But they need a healthy sense of skepticism in order to succeed. Many stock promotions have an environmental angle. A number of penny stocks have dropped their old, unsuccessful business plans and become a solar power stock, a wind power stock or some other form of green stock. The stock-promotion business has always worked that way. Promoters take whatever fear or issue concerns people most and use it to generate interest in the stocks they are promoting. Investing in these stocks can pay off temporarily, depending on the promoter’s ability. But most eventually wind up worthless....

Growth stocks are companies that are expected to have earnings growth above the market average. Frequently, growth stocks pay little or no dividends, instead re-investing any extra money to promote further growth. These are not to be confused with momentum stocks. Momentum stocks are stocks that are moving higher in the market. While individual definitions may differ, the overall goal from momentum trading is to profit from shorter-term trades. Momentum investors are particularly keen on the so-called ‘positive earnings surprise’, when a company outdoes brokers’ earnings estimates. They view a ‘negative earnings surprise’ — lower-than-expected earnings — as a sell signal. They use a variety of computerized formulas to make buy and sell decisions, but all come down to “Buy on strength and sell on weakness.” So they tend to pile into the same stocks all at once, and the gains that follow are something of a self-fulfilling prophecy....

There are, in some cases, ways of structuring your business affairs using offshore investing companies or trusts that can cut or defer your taxes. You may also be able to protect your assets from legal judgments rendered in Canada if you move them to accounts in certain foreign jurisdictions. Earnings in an “offshore account” are generally lightly taxed, or not taxed at all, by the country where the bank or brokerage account is located. This includes jurisdictions like Switzerland or the Cayman Islands. However, Canadian residents are obliged to report any income they earn through foreign investing on their Canadian tax returns. (You can only claim tax-exempt “non-resident” status without giving up your citizenship by staying outside of Canada for more than half of a tax year.)...

YUM! BRANDS INC. $28 (New York symbol YUM; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 459.9 million; Market cap: $12.9 billion; Price-to-sales ratio: 1.2; WSSF Rating: Above Average) is the world’s largest fast-food operator, with over 36,000 outlets in more than 110 countries. (McDonald’s Corp. has fewer restaurants than Yum, but higher annual sales.) Its major chains include KFC (fried chicken), Pizza Hut, Taco Bell (Mexican food), Long John Silver’s (seafood) and A&W (root beer and hamburgers). Yum continues to aggressively expand in China, particularly its KFC fried-chicken restaurants. Yum’s China division, which includes Taiwan and Thailand, accounts for 30% of its sales and earnings. Yum’s U.S. operations provide 45% of its sales and 40% of its profit. Its international division (excluding China) supplies 25% of its revenue, and 30% of earnings. Thanks mainly to strong growth at the China division, Yum’s revenue rose 25.2%, from $9 billion in 2004 to $11.3 billion in 2008. Earnings rose 30.2%, from $721 million in 2004 to $939 million in 2008. Yum has bought back over $5.6 billion worth of its shares since 2004. As a result, per-share earnings rose 61.9%, from $1.18 in 2004 to $1.91 in 2008. Cash flow per share rose 61.4%, from $2.02 in 2004 to $3.26 in 2008....

AGILENT TECHNOLOGIES INC. $16 (New York symbol A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 345.3 million; Market cap: $5.5 billion; Price-to-sales ratio: 0.2; WSSF Rating: Average) makes testing systems that help electronics manufacturers improve the quality of their products. Agilent also makes measurement equipment for medical research labs and drug companies. Demand for Agilent’s medical-related products remains steady, but the recession has hurt sales of cellphones and other electronic devices. As a result, manufacturers are spending less on the company’s testing equipment. In response, Agilent plans to drop some of its businesses and shrink its workforce by 3%. The company expects to pay $100 million in severance and other expenses. But these moves should lower Agilent’s costs by $150 million a year, and let it keep spending 14% of its sales on research. To put these amounts in context, Agilent’s earnings in its first fiscal quarter, which ended January 31, 2009, dropped 47.1%, to $72 million, or $0.20 a share. It earned $136 million, or $0.36 a share a year earlier (these figures exclude restructuring and other charges). Sales fell 16.3%, to $1.2 billion from $1.4 billion....

VERIGY LTD. $7.61 (Nasdaq symbol VRGY; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 58.2 million; Market cap: $442.9 million; Price-to-sales ratio: 0.8; WSSF Rating: Extra Risk) designs and makes test systems that are used in computer-chip production. Because of slowing computer sales brought on by the recession, Verigy lost $41 million, or $0.70 a share, in its first fiscal quarter, which ended January 31, 2009. It earned $33 million, or $0.53 a share, a year earlier. These figures exclude unusual charges, including severance costs related to an 18% cut in Verigy’s workforce. The plan should reduce Verigy’s costs by around $100 million a year, and help it break even on $110 million in quarterly revenue. Sales during the quarter fell 66%, to $68 million from $200 million. Verigy holds cash of $300 million, or $5.16 a share, and has no debt. Verigy’s research costs were unchanged at $25 million, but were a high 36.8% of sales. This was mainly because of a sharp drop in new orders. The company’s restructuring should help it maintain its high research spending. This will let it develop new products that will fuel future sales....