In the ever-changing landscape of the stock market, high-risk stocks often emerge as hidden gems, particularly when the dust settles after periods of volatility. These stocks, known for their susceptibility to unpredictable market forces, can dramatically collapse within weeks but also double in value in just a matter of days. Billionaires and seasoned investors frequently integrate these high-risk stocks into their portfolios, carefully assessing the timeline for recovery, potential for innovation, and long-term asymmetry. For them, the aim goes beyond mere survival during downturns; it is about capitalizing on the subsequent market resurgence.

Amid this prevailing sense of panic, a select group of elite investors is doubling down on their risky investments. At first glance, their approach may appear to be rooted in reckless optimism, seemingly disregarding the grim market conditions. However, many billionaires hold a firm belief that the most lucrative opportunities often present themselves during the bleakest periods of the market. Historical data further supports this notion; between 1980 and 2023, the average intra-year decline in the market reached approximately 14%. Yet, even with such staggering downturns, the market managed to post positive annual returns in 32 of the last 44 years, a phenomenon experts refer to as positioning ahead of the rebound.

Currently, experts characterize the new commercial environment as a full-blown trade war, primarily triggered by the U.S. President's sweeping 10% tariffs on all trading partners. The immediate aftermath of these tariffs has seen targeted countries retaliating with additional tariffs on U.S. goods, exacerbating tensions. Notably, China, the United States' largest trading partner, has responded with a significant 34% tax on American goods alongside a crackdown on U.S. firms operating within its borders.

This perspective is especially relevant today as the stock market experiences its most significant decline in value since the onset of the COVID-19 pandemic. On April 4, CNBC reported that only a small handful of companies managed to finish the trading day in the green, thus narrowly escaping the adverse effects of the U.S. tariffs.

In turbulent times, investors typically gravitate toward safer assets as global markets begin to exhibit signs of chaos. However, for billionaire investors, market turmoil can signify something entirely different: an opportunity waiting to be seized. The new tariffs implemented by the current U.S. President on April 2, 2025, sent ripples throughout Wall Street, prompting numerous headlines to forecast an impending recession. Yet, rather than retreating, some of the wealthiest and most astute minds in the financial world are focusing on high-risk stocks—not out of fear, but with the intent to exploit the situation. This mentality operates on the belief that while market storms may wash away the timid, they simultaneously expose lucrative bargains for those willing to venture into the fray.

In our recent publication, we presented a list of the 10 Best High-Risk Stocks to Buy According to Billionaires. In this article, we will delve into where Adobe Inc. (NASDAQ:ADBE) ranks among the other high-risk stocks identified by these financial titans.

Growth stocks are regaining prominence within the high-risk investment landscape. Although they are currently feeling the impacts of market volatility, historical comparisons indicate that growth stocks have consistently outperformed value stocks over multiple decades. While these outperformance metrics are not without their fluctuations, they suggest that investors can proceed with conviction and patience, even amidst turbulence.

However, selecting the right high-risk stocks requires a nuanced understanding of market psychology and the broader economic dynamics at play. In this context, billionaire portfolios can provide a valuable lens into market behavior, as their public disclosures reveal the stocks where high capital concentration exists despite prevailing negative sentiment.

It’s important to note that these investments are not mere random bets. Instead, they serve as indicators that income-seeking investors can utilize to diversify their portfolios with a few carefully chosen high-risk stocks, potentially reaping the benefits of the expertise reflected in these billionaire strategies.

Our Methodology

For this article, we reviewed Insider Monkey’s billionaire database for Q4 2024, identifying stocks with a beta value near 1.5, signifying that they are likely to be about 50% more volatile than the broader market. Additionally, our list comprises stocks that have posted positive earnings per share (EPS) over the past five years, as well as a positive projected EPS growth for the next five years. This criterion was established to ensure that we only considered stocks with a proven track record of profitability and potential for future earnings growth. All the stocks featured have received a Strong Buy rating from Wall Street analysts, indicating a favorable market outlook.

Furthermore, the stocks included in our list are all large-cap firms, underscoring their significant market presence and liquidity. We ranked these stocks based on the stakes held by billionaire investors, utilizing data sourced from financial databases and industry analysts, with all information current as of April 4, 2025. We also considered the number of hedge funds holding stakes in each stock to gauge institutional interest.

Why do we focus on the stocks favored by hedge funds? The rationale is straightforward: research has indicated that mimicking the top stock picks of the best hedge funds can lead to market outperformance. Our quarterly newsletter strategy involves selecting 14 small-cap and large-cap stocks each quarter, returning an impressive 373.4% since May 2014—significantly outpacing its benchmark by 218 percentage points.

Is Adobe Inc. (ADBE) the Best High-Risk Stock to Buy According to Billionaires?

Adobe Inc. (NASDAQ:ADBE) stands out among high-risk stocks, with a notable number of billionaire investors backing it.

Number of Billionaire Investors: 18
Total Value of Billionaire Holdings: $5.78 Billion
Beta: 1.54

As a global leader in digital media and experience software, Adobe is headquartered in California and is renowned for its flagship products like Photoshop, Acrobat, and the Creative Cloud suite. The company also offers marketing automation and analytics solutions through the Adobe Experience Cloud, catering to creators, marketers, and businesses alike. While Canva remains a formidable competitor, Adobe continues to maintain its competitive edge through its subscription-based revenue model and ongoing innovations in AI-powered tools such as Adobe Firefly.

With the support of 18 billionaire investors holding a combined $5.78 billion, Adobe’s market position reflects a strong vote of confidence in its leadership in creative software. This confidence is further underscored by an 11% year-over-year growth in revenue, driven by robust performance in its Digital Media business as well as the Document Cloud segment. Notably, the Adobe Experience Platform and its native applications surpassed $1 billion in their business sector, fueled by their widespread adoption among industry leaders. For the fiscal year of 2025, Adobe anticipates revenue to range between $23.3 billion and $23.55 billion, thus attracting investors who see it as one of the top high-risk stocks worth considering.

Adobe Inc.’s beta of 1.54 indicates a moderate level of volatility. Over the past five years, the company's EPS has grown by 15.54%, with a projected growth rate of 11.46% over the next five years. Institutional interest is robust, as evidenced by 117 hedge funds tracked by Insider Monkey holding positions in the company at the end of Q4 2024.

Overall, Adobe Inc. ranks first on our list of the best high-risk stocks to buy according to billionaire investors. While we recognize Adobe's potential as a compelling investment option, it’s worth noting that some AI stocks may offer even greater promise for delivering higher returns in a shorter timeframe. In fact, one AI stock has experienced growth since the beginning of 2025, while other popular AI stocks have plummeted by approximately 25%. For those interested in uncovering an AI stock that shows more promise than Adobe but trades at less than five times its earnings, we encourage you to explore our detailed report on the cheapest AI stock available.

To delve even deeper, don’t miss our lists of the 20 Best AI Stocks to Buy Now and the 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.