Top high-risk high reward stocks for 2025

Key Takeaways

• A high-risk, high-reward stock is one that swings aggressively by more than 20-30% within a short period of time
• High-risk stocks are highly influenced by investor sentiment toward news or comments from industry leaders
• Before investing in high-risk stocks, you should consider your risk-reward ratio to mitigate against substantial losses

Introduction

Have you ever looked at your portfolio and considered placing a portion of your investments toward more high-risk, high-reward stocks? Everyone, including myself, has found multiple upsides to investing a small portion toward potentially high-return stocks.

In some cases, you could see staggeringly massive returns, but placing a large portion of your investment toward these high-risk stocks can also lead to staggering losses. I often follow a personal 70/20/10 rule, whereby my portfolio is split between low, medium, and high-risk investments.

What are considered high-risk stocks?

In a nutshell, high-risk stocks generally have extreme volatility and are mostly driven by investment sentiment. A good rule of thumb is if a stock raises or drops by more than 20-30% within a few hours, we can consider these to be high-risk stocks.

List of high-risk, high-return reward stocks

• Meme stocks - driven mostly by investor sentiment
• Penny stocks - much lower trading volumes
• Biotech stocks - highly influenced by new trial approvals
• Quantum stocks - high speculation on future technology

Meme stocks

Meme stocks are a type of stock that is heavily influenced by investor sentiment compared to a stock's fundamental value. These types of stocks are often highly volatile and are driven by social forums and communities, most notably Reddit's WallStreetBets.

GameStop (GME)

It is one of the most popular meme stocks and, in most cases, the one that started it all. GameStop stock was part of what is now known as the GameStop saga, whereby numerous retail investors kept buying GME stock and short-squeezing many Wall Street investors out.

During the saga, GME stock surged by 10,897.4% from $0.79/share to $86.8/share in 2019. Investors saw another surge in GME stock in 2024 by 346.8% due to the return of Keith Gill, the catalyst of the GameStop saga.

AMC Entertainment (AMC)

AMC's stock, similar to GameStop, found itself at the center of the meme stock craze. AMC stock saw a surge of 2669.5% in 2021 from $9.44 to $261.44. Since then, the stock has steadily lost its value and dropped to $3.55.

Although AMC Entertainment's stock is 98.6% from its 2021 all-time high, it is still closely influenced by online communities that could drive its stock price back up, making it a very high-risk, high-reward stock to consider.

Penny stocks

Penny stocks provide extreme volatility and are considered very high-risk stocks. Penny stocks can see extreme growth by 100's of percent within several hours only to lose its value by 99% hours later. Penny stocks are also more susceptible to pump-and-dump schemes and market manipulation.

Innoviz Technologies Ltd. (INVZ)

Innoviz is a leading Li-dar company focusing on developing a safe, autonomous-driving future. The company is showing signs of growth, with an average increase in YoY revenue by 128% over the past 3 years. In addition, multiple analysts have either upgraded or maintained a 'strong buy' rating for Innoviz's stock.

Energy Vault Holdings Inc (NRGV)

Energy Vault Holdings, Inc. develops and sells energy storage solutions. The company offers gravity-based storage systems starting from 40-megawatt hour. The company reported revenue of $345 million in 2024. Although the company is not yet revenue-positive, the energy storage industry is expected to double to $841 billion by 2033.

Biotech stocks

The latest medical news, such as new FDA-approved trials or drugs, closely influences biotech stocks. When news such as this is announced, some biotech stocks begin skyrocketing. These are great high-risk, high-reward stocks.

Bright Minds Biosciences (DRUG)

A pre-clinical biosciences company, develops 5-HT (serotonin) medicines to improve the lives of patients with severe and life-altering diseases. In 2024, the company saw a stock surge of 1,921% increase due to the acquisition of its lead drug and the completion of its phase 1 clinical trials for its BMB-101 drug.

GeneDx Holdings (WGS)

GeneDx Holdings Corp. is a patient-centered health intelligence company. It engages in transforming healthcare by applying AI and machine learning. Throughout the last year, the company's stock price rose by over 1,300% in the wake of its announcement of a novel genetic testing platform that could reshape the diagnostic industry.

Quantum stocks

Arguably one of the most prominent high-risk high-return future potential stocks. With the growing popularity and speculation of quantum technology, quantum stocks may offer great long-term returns as the industry matures.

Regetti (RGTI)

The company builds quantum computers and the superconducting quantum processors that power them. In 2024, Regetti stock saw a stock surge of over 540% largely driven by the announcement of Google's quantum chip breakthrough, leading many to speculate on the release of quantum computing.

D-Wave Quantum (QBTS)

D-Wave Quantum Inc. develops and delivers quantum computing systems, software, and services worldwide. Unlike Regetti, D-wave also provides a full suite of open-source programming tools. In 2024, D-wave saw a stock surge of over 300%, again following the announcement of Google's quantum breakthrough.

Best alternative high-risk, high-reward investment methods

Although the above stocks can provide a high reward-to-risk ratio, I have also included other areas for you to consider. If investing in the stock market is less favorable, you can consider these alternative high-risk, high-reward investment methods.

Cryptocurrencies

Crypto is infamously known to be a highly risky investment, with numerous stories of people losing their life savings. However, there have also been many overnight success stories. My general rule with crypto is to place 5% or less of my investment portfolio toward it. I do this to ensure my risk-to-reward ratio remains balanced.

Angel Investing

Angel investing is less about the financial markets and more about ownership of companies at their early stages. A staggering 90% of startups fail, with only 10% of them successfully exiting. If you invest in a startup from its onset and it's successful, the returns can be staggering.

Frequently Asked Questions

What stock will skyrocket in 2025?

While no one can accurately predict which stocks will gain value throughout 2025, there are indications that AI stocks are receiving the most attention from stock buyers. Investing in companies that are actively building AI solutions may offer the highest returns.

How do you know if a stock is high-risk?

A stock is considered high risk if it exhibits characteristics such as high volatility, small market capitalization (small-cap stocks), or financial instability, such as low earnings or high levels of debt. Companies in emerging or unproven industries, like biotech or startups, also pose higher risks due to market uncertainty.

What should a balanced stock portfolio look like?

A balanced stock portfolio should be diversified across various sectors and asset types to reduce risk while ensuring long-term growth. It should include a mix of growth stocks, which offer high return potential but come with higher volatility, and value stocks that provide stability through undervaluation.

Conclusion

As you can see, there are multiple options available for high-risk, high-reward investing. It ultimately comes down to how risk-tolerant you are and which area of investing you want to undertake.

It might be best to start with an initial small investment instead of risking large sums of your portfolio. Another method could be the dollar cost average high-risk investments, whereby you invest a small sum regularly over several months. Regardless of which you choose, remember to fully research any financial instrument thoroughly.