Growth Investing Strategy

STRATEGY DESCRIPTION

Our Growth Investing Strategy is designed to maximize capital appreciation by targeting companies poised for above-average earnings or revenue growth. This approach is not about getting a bargain, but about investing in businesses that exhibit strong potential for expansion, disruption, and market dominance.

The core tenet of growth investing is simple: you’re seeking companies that are expected to grow at an above-average rate compared to other firms in the market. These companies are often in the tech, biotech, or emerging industries, but can also be found in traditional sectors that are experiencing transformational changes. The companies might be rolling out innovative products, expanding into new markets, or simply reshaping their industries with disruptive business models.

Historical trends show that growth investing can yield impressive returns over the long term. Many of the world’s most successful investors, like Philip Fisher and Thomas Rowe Price, Jr., have used this strategy to build immense wealth.

WHAT YOU WILL LEARN

Growth stock investing is not a passive strategy; it requires time, research, and a keen understanding of market trends. But for those willing to put in the work, the potential for significant returns is considerable. It’s about finding tomorrow’s market leaders today and riding their growth trajectory to achieve robust portfolio returns.

Growth investing has been particularly successful in bullish markets where optimism and investor sentiment are strong. In such conditions, investors are more willing to pay a premium for stocks with high growth prospects. However, it’s essential to be aware that growth stocks can be more volatile than the broader market, particularly in downturns or periods of economic uncertainty.

Investors can profit from growth investing in two ways: capital gains and portfolio diversification. Capital gains are realized when the value of the stock increases, and you sell the stock for more than you paid for it. On the other hand, including growth stocks in your portfolio provides a diversification benefit. These stocks often behave differently than value or dividend stocks, providing a balance and spreading risk.

Analyzing and selecting growth stocks involves both quantitative and qualitative assessment. Quantitatively, you would look for companies with high rates of growth in earnings, revenue, and cash flow. Consistent and rapid growth in these areas often indicates a company’s potential for future growth. Qualitatively, you would examine the company’s management, market position, industry growth, and competitive advantage.

LEARNING OUTCOMES

A successful Growth Stock investing Strategy is one of the most sought after strategies as the upside is potentially huge. Working through our Growth Strategy you will learn how to construct the strategy, the criteria to us and how to manage and rebalance the portfolio of growth stocks to maintain performance.