A speculative stock is one in which a trader speculates. The fundamentals of the stock show no obvious strength or sustainable business model, causing it to be viewed as very risky and trade at a comparatively low price, though the trader is hopeful that this will change one day.

Speculative stocks are shares in companies with a high potential for significant price fluctuations, often driven by investor speculation rather than solid fundamentals. These stocks usually belong to smaller, emerging companies, such as startups or firms in rapidly changing industries like technology or biotech. While speculative stocks offer the possibility of substantial returns, they also come with higher risk, as their success is often uncertain. Investors might be drawn to these stocks hoping for quick profits, but they must be prepared for the possibility of losses, as the companies may lack established track records or stable revenue. Speculative stocks are generally best suited for risk-tolerant investors who can afford to withstand potential volatility in their portfolios.