11 Dec 2022
As an aggressive capital appreciation strategy, growth investing requires a curious, and creative mindset to achieve cohesive portfolio returns that generate wealth at a highly accelerated pace.
While most growth stock prices fell more than 20% in the first two quarters of 2022, prudent investors consider this as the best time to invest in such stocks. Growth investing refers to picking and investing in stocks of the companies that grows rapidly in terms of revenue and earnings than their other competitors of the same industry.
Thus, the purpose of growth investing is to generate profits through capital appreciation which is an investor’s expectation to receive gains through higher stock price in the future. Hence, growth investment strategy follows a futuristic approach to find out companies with high potential to grow in future. It means investors expect its intrinsic value in the future will be higher than its intrinsic value today.
Fundamentally, growth investing involves companies that has these attributes: rapidly rising year-over-year sales, consistent growth in quarterly revenue, increased earnings per share, constant growth in net profit, and ever growing cash inflow from the operations. Thus, we analyse these factors with the help of technology to design an investment portfolio that ensures higher portfolio returns through investing in emerging markets, blue chip companies, and small companies with high potential to grow.
Growth stocks may consist of companies that continuously grows in an existing market, or creates a new market for an innovative product, or gaining increased share in the new markets. Businesses with potential to grow fast gets rewarded by the market with higher stock prices and ultimately investors get better returns.
We combine various investment strategies such as value investing, growth investing and dividend investing to customize our client’s portfolio to enhance their exposure with different assets and accumulate wealth at an increased pace.
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