At times of volatility, it can be hard for even experienced investors to stay the course. Yet over time, stocks have consistently increased in value. And growth stocks tend to be among the ones that show the largest gains. Growth stocks are companies that analysts believe will grow at a rate that is significantly above the market average.
These stocks are also characterized by companies that invest a significant portion of its profits back into its business in order to accelerate growth. This is opposed to value stocks that make returning a portion of its profits to shareholders a priority. This typically occurs in the form of a dividend.
One misconception of growth stocks is that they have a high correlation with the market. It’s true that when the market is moving higher, these stocks tend to outperform. However, when the market is moving lower, these stocks sometimes perform better.
So why should you consider buying growth stocks now? The reason is this. In many cases, the company’s underlying fundamentals are still positive, but the sentiment has changed. And that means it’s a good time to buy these stocks on sale.
Click the "Continue to Slide #1" button to view the first company.
