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One simple way to benefit from the stock market is to buy an index fund. But many of us dare to dream of bigger returns, and build a portfolio ourselves. Just take a look at Salt Lake Potash Limited (ASX:SO4), which is up 61%, over three years, soundly beating the market return of 24% (not including dividends).

Check out our latest analysis for Salt Lake Potash

With zero revenue generated over twelve months, we don't think that Salt Lake Potash has proved its business plan yet. As a result, we think it's unlikely shareholders are paying much attention to current revenue, but rather speculating on growth in the years to come. It seems likely some shareholders believe that Salt Lake Potash will significantly advance the business plan before too long.

As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. You should be aware that there is always a chance that this sort of company will need to issue more shares to raise money to continue pursuing its business plan. While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized). Some Salt Lake Potash investors have already had a taste of the sweet taste stocks like this can leave in the mouth, as they gain popularity and attract speculative capital

When it reported in December 2018 Salt Lake Potash had minimal net cash consider its expenditure: just AU$10m to be specific. So if it hasn't remedied the situation already, it will almost certainly have to raise more capital soon. Given how low on cash the it got, investors must really like its potential for the share price to be up 17% per year, over 3 years. You can see in the image below, how Salt Lake Potash's cash and debt levels have changed over time (click to see the values).

It can be extremely risky to invest in a company that doesn't even have revenue. There's no way to know its value easily. However you can take a look at whether insiders have been buying up shares. It's often positive if so, assuming the buying is sustained and meaningful. Luckily we are in a position to provide you with this free chart of insider buying (and selling).

What about the Total Shareholder Return (TSR)?

We've already covered Salt Lake Potash's share price action, but we should also mention its total shareholder return (TSR). The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Salt Lake Potash hasn't been paying dividends, but its TSR of 61% exceeds its share price return of 61%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.