Two weeks ago I said this correction is probably over. And that turned out to be the exact bottom. Of course, a lot of luck was involved. Nobody can time the exact top or bottom on purpose. But you don’t need to.

What really matters is having a system that keeps you on the right side of the market. There is no certainty in the markets. But if your strategy puts the odds in your favor over long enough period, you’ll win eventually.

Now what we’re seeing is a snapback from many of the growth and momentum names.

• AI

• Space

• Drones

• Nuclear

• Robotics

• Quantum

• Rare Earths

So make sure to review the thematic portfolios.

Those are the names that will outperform in a bull market. And make large moves in a matter of weeks or even days.

Though they rarely have strong fundamentals backing them. Instead, they are mostly based on promising, exciting possibilities for the future. That’s why these stocks tend to be incredibly volatile, erratic, and heavily influenced by sentiment and short-term catalysts.

Hence, they are riskier and more volatile. Those are not names you just buy and hold for years. Many of them will not make it. So, you have to manage risk tightly and be disciplined.

That being said they offer tremendous opportunities in the right market environment. And the best time to track them is coming out of a correction. Timing is essential. Waiting for the right moment is key. You don’t to end up chasing late or too early. (More on that in Chapter 3 of the Handbook for that which you can read here.)

So, here’s a quick guide on how to handle speculative names:

• Price action: Look for stocks making recent all-time highs or coming out from bases after pullbacks.

• Volume: Confirm that the price move is supported by strong volume. Ideally volume should be several times higher than the stock’s average daily volume.

• Avoid FOMO: Don’t chase in just because it’s up right now. Wait for the right opportunity.

• Position size: Keep it small relative to your overall portfolio (around 1–5%). You don’t want a single bad position to take a big chunk of your capital, especially in volatile names.

• Be ready to cut your losses quickly: If the position stops working, cut losses quickly rather than hoping it will recover because corrections can be brutal.

• Stop loss: Use tight stops. A good rule is to set stops 5–8% below your entry price or just below a key support level or breakout point.

• Take profits in stages: Speculative stocks can move fast. Don’t hold 100% of your position until the top. Sell 25–50% at predefined price targets depending on your risk reward profile (e.g., +25%, +40%, etc.).

• Trailing stops: After partial profit-taking, use trailing stops (e.g., 5–10% below the current high or under a moving average like the 10-day EMA) to protect gains while allowing the stock to run.

• Watch volume and price action: If volume dries up or price action weakens (e.g., lower highs, a break of a key moving average, bearish reversal candlesticks), consider reducing or exiting.

• Don’t let winners turn into losers: If you have a sizeable gain, make sure to book some profits along the way. That gives you some cushion to weather volatility.

• Be prepared for volatility: Lastly, expect a healthy dose of volatility and large swings both ways.