Investors operating in a market environment that continues to produce broad gains can still be exposed to sudden, concentrated reversals. Sector rotation and rapid shifts in sentiment can turn past winners into sources of short-term losses if positions are not actively managed.
One important skill for investors is not simply identifying promising entries, but recognizing the point at which it makes sense to crystallize gains. That trade-off is central to the monthly rebalancing performed by the ProPicks strategies, which use machine learning to both capture outsized winners and step aside before notable pullbacks.
For a subscription costing less than $9 a month, premium members received access to ProPicks signals that highlighted entries, exits, and reallocation rationale. Two of the clearest demonstrations of this approach occurred with Hims & Hers Health and Klaviyo during April and early May.
Hims & Hers Health (NYSE: HIMS) - 38.2% gain then an 11.93% slide
ProPicks identified Hims & Hers at an entry of $19.84 during April, a timing that enabled members to capture a rally to $27.41, a 38.2% return. As the calendar turned to May, the strategy's monthly review signaled that members should take profits and redeploy capital into higher-ranked alternatives. After being removed from the high-conviction list, HIMS fell to $24.14, off about 11.93% from the April peak.
The AI supplied a multi-factor explanation for the exit:
- Volatile swings and stretched valuation - The model favored moving into stocks with cleaner risk-reward characteristics as stronger-ranked opportunities surfaced.
- Lagging performance masked by one-day spikes - Despite an approximately 41% single-day rally tied to Novo Nordisk partnership news, the AI judged that extreme short-term moves had obscured elevated volatility and left the stock with less favorable dynamics versus peers.
- Valuation pressure - With the shares trading near roughly 53x earnings and carrying an operating margin of about 5%, the valuation appeared extended compared with the reported fundamentals and the consensus analyst fair value near $26.
- Near-term headwinds - The system flagged increased regulatory scrutiny from agencies such as the SEC and DOJ, plus intensifying competition from Amazon, as factors increasing uncertainty around the stock.
That said, the engine's removal of HIMS was positioned as a protective, tactical decision rather than a judgment that the business had failed: the company reported 59% full-year revenue growth, a sign of genuine momentum even as immediate upside appeared limited.
Klaviyo Inc (NYSE: KVYO) - 27.5% gain before a 55.89% crash
Klaviyo was added to ProPicks in March at $17.41 and climbed to $22.20, producing a 27.5% gain for subscribers. During the May rebalancing, the model removed KVYO. In the ensuing weeks the stock plunged to $14.24, a drop of approximately 55.89% from its post-exit high.
The data-driven rationale provided to members highlighted several themes:
- Relative market lag and shifting opportunity set - The model shifted staffings toward opportunities with superior profiles across market performance, valuation, and growth expectations.
- Sustained underperformance versus recent peaks - At the time of rotation, KVYO was trading at roughly half of its 52-week high, a signal the engine treats as an indicator of deteriorating market positioning.
- Decelerating growth and non-profitable GAAP results - Revenue growth was slowing from about 33% the prior year to a guided 21-22% for fiscal 2026, while the company continued to report a negative operating margin on a GAAP basis.
- Challenging multiples - The combination of negative earnings and an expected slowdown in top-line expansion made the prevailing valuation difficult for the model to justify relative to peer sets.
Even so, the AI's removal was not characterized as a condemnation of Klaviyo's balance sheet or longer-run prospects. The company holds over $1 billion in cash, carries no debt, and had authorized a $500 million buyback. The system's assessment was that near-term upside was largely exhausted, making exit the prudent action to preserve gains.
Additional examples where rebalancing protected gains
HIMS and KVYO were not isolated incidents. ProPicks flagged a number of other high-conviction names and removed them following meaningful runs, avoiding subsequent pullbacks:
- Victoria's Secret & Co. (NYSE: VSCO) - After a five-month advance from $29.35 to $62.71 that yielded a 113.63% return, ProPicks exited VSCO in March. The stock later retreated about 27.93%.
- Fortrea Holdings Inc (NASDAQ: FTRE) - The strategy rotated FTRE out after booking a 76.58% gain, which allowed members to sidestep an ensuing drop of approximately 13.92%.
These instances emphasize a central point: an asset that appears undervalued at one review can be overextended at the next, and systematic rules for rotation can preserve capital and crystallize performance.
Performance and process of the ProPicks engine
Since the official launch of the AI models in November 2023, the ProPicks strategies have recorded a cumulative return of +178.21% and have outpaced the S&P 500 by +103.02% over the same period, according to the recorded results. Those figures reflect the combined effect of entries, exits, and monthly rebalancing across the published strategies.
At the start of each month, the proprietary system evaluates thousands of equities around the world using a mix of historical metrics, valuation indicators, and forward-looking growth signals. The engine processes more than 15 years of financial data across in excess of 150 quantitative models to identify up to 20 high-conviction stocks per strategy, each selected for projected medium-term upside potential.
Every month, the strategies run a disciplined rebalancing: new candidates are added, clear underperformers are removed, and strong performers may be retained when they continue to meet the model's thresholds. For transparency in assessing model returns, each strategy uses equal weighting across its selected stocks, although subscribers are free to set their own allocations.
The objective is to systematically redeploy capital toward the strongest setups as conditions evolve, rather than sitting passively through dramatic short-term swings.
Where this leaves investors
When markets become choppy, opportunities emerge to buy high-quality names at reduced prices. ProPicks reports that its May selection list is live and that the model is flagging names it assesses as having the most upside potential under current conditions. Subscribers receive not only the list of tickers but also the explicit rationale for each addition and removal, providing a data-backed narrative that accompanies every signal.
For traders who struggle with that final step between identifying a chart pattern and executing a trade, the suite includes chart analysis tools that generate practical trading plans - entries, stop-loss levels, and profit targets - intended to close what the platform terms the conviction gap.
Subscription pricing referenced in communications is accurate at time of publication. The service periodically tests offers that may vary by region.