One of the great joys of investing is buying a stock that goes on to explode as everyone catches on to what you knew.
The second greatest joy arguably is daydreaming about the riches you would be bathing in if you were that lucky person.
Of course, The Motley Fool always cautions against quick-rich schemes. Always remember that the risk is proportionately higher if the potential reward is astronomical.
This is why diversification is so critical for your portfolio. With shrewd stock selections, the idea is that the winners make more money than what you lose with your duds.
With this in mind, let's examine one ASX mining stock that went berserk over the past year.
While I'm not saying every stock, or even any stock, that you pick will perform this well, it keeps the mind focused that a few winners can go a long way to cancelling out the dogs.
And it allows us to daydream about how wealthy you could have been…
What a crazy 2023 for this miner
WA1 Resources Ltd (ASX: WA1) is a junior miner focused on the exploration phase.
The company is currently running three projects, all within Western Australia — West Arunta, Madura, and Hidden Valley.
The business is attempting to find viable sources of metals required for a world reducing its carbon emissions, such as niobium.
On the first trading day of 2023, WA1 shares were going for $1.60.
Let's imagine you bought $20,000 worth of stocks at that price.
Fortunately, throughout the year the company released some promising drilling results at its sites, especially at West Arunta.
All the excitement kept pushing the stock price higher, to a point where it closed Tuesday at $13.02.
Your $20,000 is now a cool $162,750.
Making up for losers
With a star like this in your portfolio, you could have seven other losers that went to zero and the overall investment would still be in the green.
Incredible.
Of course, those investors who took the chance at the start of last year committed to WA1 when the success of the business was much less certain.
The amazing riches they enjoy now is reward for taking on that risk.
Best wishes for your investments.
