Growth investing involves investing in companies with high growth potential to generate capital appreciation. Value investing involves investing in companies trading below intrinsic value with the potential to go higher. What is the difference between the two investing styles, and how to choose?
People invest in stock markets, either directly in stocks or mutual funds, to achieve their financial goals. However, different investors take different approaches to equity investing. These investment approaches include active vs. passive funds, value investing vs. growth investing, diversified funds vs. focus funds, core and satellite portfolio, investing in sectoral/thematic funds or smart beta funds, etc. In this article, we will discuss growth vs. value investing: What are these investing styles, how do they work, what is the difference between them, and which one should you choose?
Highlights of the article
Growth investing involves maximising capital appreciation by investing in stocks with higher growth potential.
Value investing involves investing in stocks tra...