Growth stocks versus value stocks: It’s possibly the oldest debate on Wall Street.
Historically, value stocks have led to higher average annual returns, according to a Bank of America/Merrill Lynch report that examined the 90-year period between 1926 and 2015. But since the end of the Great Recession, growth stocks have pummeled value stocks. Record-low interest rates are fueling borrowing and allowing growth stocks to hire, innovate, and acquire with ease.
With lending rates expected to remain low for years as the U.S. economy recovers from the crippling coronavirus pandemic, growth stocks should remain in focus. If you have, say, $4,000 in cash that you won’t need to pay bills or cover emergencies, then you have more than enough capital to dive into the following four growth stocks.