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The truth about growth and value stocks
The common language of equity markets suggests that growth stocks promise faster growth than value stocks.Operating under that premise, investors use growth indexes to find stocks with stronger growth—and executives try to bolster the standing of their stocks by pursuing growth investors.Both such investors and executives are misguided. In general, growth stocks and value stocks grow at the same rate. And investors don't cause a stock's designation as a growth stock; they respond after the fact.
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