Speculative stocks are a risky proposition in today’s market. With even the S&P 500’s most stable giants dropping, small-cap risky stocks don’t stand a chance. 

Unless you’re willing to dig a little to find high-risk, high-reward stocks appropriate for today’s conditions. One of my favorite strategies is learning as much as possible about a particular industry while its popularity is at a fever pitch. If you follow markets, certain speculative sectors rise rapidly before falling to a fraction of past pricing. 

However, that doesn’t mean the sector is doomed to failure. It simply means market realism caught up to excessive exuberance. That realignment means potential. These three speculative stocks are part of past sector overenthusiasm—AI-driven biotech, cannabis and streaming—and their stock pricing is in the gutter. However, each has unique benefits and strengths despite sector-wide weakness. 

Recursion Pharmaceuticals (RXRX)

Recursion Pharmaceuticals (NASDAQ:RXRX) exploded in July on the strength of hot news—a $50 million direct investment from Nvidia (NASDAQ:NVDA). Since that month’s high, shares are back in the gutter at nearly a third of past pricing. However, nothing has materially changed about RXRX, nor Nvidia’s enthusiasm.

RXRX leverages AI to rapidly and accurately identify cross-gene relationships and interactions within their massive (and expanding) genetic dataset. The upside to their platform’s tech is that running generative AI processes in pharmaceutical development slashes drug discovery time. Drug discovery is the long, slow process of determining which compound combinations will work therapeutically when interacting with genes. As you can imagine, manually managing drug discovery through the endless sorting of millions of data points is like finding a needle in a haystack. RXRX’s unique and viable AI platform likely stands as a revolutionary factor in therapeutics. Nvidia’s interest should be enough to pique yours if you’re adding speculative stocks to your portfolio.  

Tilray Brands (TLRY)

Tilray Brands (NASDAQ:TLRY) stands as one of (if not the) best speculative stocks in the cannabis sector. The reason why might surprise you – Tilray’s cannabis market strength is good, sure. However, regulatory confusion and the glacial pace of policy change mars its short-term market potential. At the same time, even if or when cannabis is legalized, actually selling products won’t be particularly profitable. Combining high product costs, including taxation, with the ease of growing cannabis and margins will favor only the leanest and nimblest firms. Instead, Tilray’s strength lies in its expansion efforts. Usually, you want a company to focus on its core offering rather than diversifying into endless opportunities. However, Tilray’s move into beer markets positions it as the next top cannabis stock once markets stabilize.

In August, Tilray cemented its position in craft brewing by buying eight brands from Anheuser-Busch (NYSE:BUD). The move instantly made this cannabis company the fifth-largest United States-based craft brewer in a market where craft beer sales grew 8 times the average sales rate in 2021.

While this opens new revenue opportunities, the real benefit to Tilray is the logistical win. By buying these brands, Tilray bought distribution networks, marketing machines, and more – all of which will serve their core cannabis operation well. Highlighting its potential, Tilray’s CEO said, “Upon legalization (in the U.S.) one day, we will infuse these drinks with THC, with CBD, but we’ll have the distribution, and we’ll have the brands when and if legalization does happen.”

Anghami Inc (ANGH)

Anghami Inc (NASDAQ:ANGH) is a speculative penny stock in the streaming sphere, but one that shouldn’t be overlooked. ANGH is the first music streaming platform in the Arab world, serving an otherwise untapped market mostly ignored by big-name U.S.-based platforms. Still, note that this is a particularly risky stock as it’s received multiple delisting warnings due to its share price. 

Still, some think the company is worth investing in. One investment firm recently sunk $5 million into the venture, notable since firms of this type are usually tight with cash (especially in today’s market). The investment pegs Anghami’s value at about $2.50 per share—more than double today’s pricing. Likewise, the company’s price-to-sales ratio is consistently around $0.50. With such a low price and bottom-barrel valuation, this speculative stock might be on to make you rich.

On the date of publication, Jeremy Flint held no positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.