Investing in value and growth

Investors are often subdivided in two main categories: value and growth. Although there are stark differences between the two approaches, it seems to be wise to consider both. There is no right or wrong in investments, sometimes different approaches and strategies produce the same outcomes. Making the same returns is not dependent on the strategy you use, but rather on how well you use that strategy. Focus on the types of profitable investments you can make, without overthinking if it fits your strategy or not.

Value vs growth

Value vs growth is among the most debated concepts between investors. Although it is possible to make sizable returns from both approaches, investors tend to be polarized towards one or the other. There is no right approach here, as some value stocks and some growth stocks are both desirable. Choosing the best out of each category seems to be a far better strategy, than choosing a specific strategy and sticking with it no matter what. Choose your stocks wisely independent of whether they are growth or value oriented.

Growth at value prices

Another interesting concept is mixing both value and growth into one strategy. Even growth investors try to invest with a value in mind. Either by expecting the company to grow at a faster pace, or they expect results to be much better than anticipated. Another way to buy growth stocks at value prices is by focusing on companies that are growing at a fast pace and are underpriced. This can happen for a number of reasons, either the stock is trading under its fair value because it had a bad quarter, or some analyst dropped its price target or estimates. Paying attention to these key factors could make a lot of difference when choosing stocks with this approach.

Finding value in growth

There are different approaches to finding undervalued stocks, some of them work better than others. Not every growth stock is expensive, you have to consider many factors when valuing such equities. Looking at the company’s financials is perhaps the most important first step. This can give you an in-depth knowledge of how the company is actually growing and creating value for shareholders. Having no predetermined ideas regarding any stock can also be very beneficial, as it allows you to not exclude any company simply because of a few pieces of data. Try to focus on the company’s sector and ask yourself how this company could grow going forward.