Value Investing Or Growth Investing?
Those who begin to look into the stock market are sure to hear about two types of investing. Namely, these are value investing and growth investing. One may hear about stocks that are value stocks and others that are called growth stocks. For someone brand new to the world of investing, these terms can certainly be confusing. Here we try to break them down and help people better understand what they are getting into.
Value stocks are basically stocks of smaller companies that one is attempting to purchase at a good value with the hope of rising prices in the future. It is not always the case that the stock is a smaller company, but they frequently are.
With this type of investing, one is taking a chance on a company that may not have as strong of a track record in the past. These are stocks that are purchased because they appear to be a good value compared to the earnings. This may sound like a good way to invest at all times, but it is not the only way that one can get their money in the market.
Investing for growth has more to do with putting money into companies that are already on a roll. This might mean putting money into the well known corporations. The reason one does this is because they believe that the good times are going to continue. They invest in industry leaders and hope that they continue to dominate the markets that they exist in.
There is nothing wrong with putting money into growth stocks. It may be something that Brad Reifler might recommend doing for clients who want a little more safety in their investments. He is the CEO of Forefront Capital and helps people of all walks of life get their funds into the market and working for them.
People who put money in growth investing are looking for something different than what those who do value investing are looking for. They are not searching out the greatest bargains in the market but rather the things that have already proven themselves and that they hope will continue to work out for the long run.