The market continues to favor companies that are growing in this slow-growth environment. Historically, there have been years when it paid to invest in growth and years when value was the place to be. Janet Brown’s latest post on the Forbes Intelligent Investing blog, “Four Funds to Buy When Growth Trends Trump Value,” examines 35 years of growth and value periods.
“Value led growth for nearly 10 years starting in 1977,” Janet points out. “A strong growth trend developed in 1989 and lasted roughly four years, then value led for four years before growth kicked off a six-year run.” Click here to read more.
Because these trends last for many years, investors can readily take advantage of them. “In this latest growth cycle, dividend growth funds and technology-focused growth funds initially led, and we bought PowerShares QQQ (QQQ), which tracks the tech-heavy NASDAQ 100, and dividend funds like Vanguard Dividend Growth (VDIGX),” Janet writes. “As the growth trend persisted, we were led to invest in blue chip funds like T. Rowe Price Blue Chip Growth (TRBCX) and Vanguard Mega Cap 300 (MGK).”
(To read all of Janet’s posts on the Forbes Intelligent Investing blog, click here).