In the stock market, risk and reward are correlated. That is, across all financial markets, the maxim is that as risk goes up, so does reward. Because of this, you won’t find many low-risk stocks with multi-bagger potential. Instead, all the stocks with multi-bagger potential are often also accompanied with big risks.
Thus, if you’re looking for a multi-bagger stock that could rise 200% or more, it’s safe to say that you are looking at stocks with big risk profiles.
The key in picking winners in this group is to identify the stocks that are more likely to go boom than bust. That is, find the stocks where the upside is compelling enough — and the probability of the stock realizing that upside is high enough — to more than compensate for the risks.