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Investment Strategy: The Basics — Growth Investment Strategy
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Growth Investment Strategy

Growth Investment Strategy

Growth investment strategy means that an investor seeks out stocks that they expect to have large growth potential. In this case, the investor believes that the company’s income and earnings will far exceed what their respective market predicts.

These companies generally reinvest much of their earnings on projects that will help them grow and increase future earnings in the future. Thus, growth investing is essentially investing in the future growth of the company.

Some investors argue that both growth and value investing are fundamentally integrated with one another.

“It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” — Warren Buffett


For a growth investor, what indicator would be the most important when picking stocks?

0/23 (0%) Correct
  • 1
    High profit margins
  • 2
    Low stock price
  • 3
    High earnings growth
  • 4
    High dividend yield
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Alex's thoughts: 
I like to mix all three of these styles but it takes a while to grasp them all. Over a decade ago, I started with growth investing and studied the other styles while I was investing in my growth companies.