What is a Growth Stock?

Growth stocks are generally issued by companies that manage to grow their earnings and revenues at a faster rate than the average typical for the industry in which they operate. Unfortunately, growth companies rarely pay dividends, since they need the generated resources for the financing of their further development and growth.

Growth stocks are preferred by investors that foresee that the price of the company's stock will rise in the long-term thanks to its growth.

Growth investors tend to concentrate their efforts in discerning stocks that present good potential for greater growth as compared to the other stocks on the market or to the stocks that are in the same industry. If you manage to develop your growth discerning skills and find such companies, over the long term you will enjoy high profits that are caused by the increase in the value of the company.

For a trading platform we recommend you try Zecco.
Zecco offers free stock trades, no account minimum, real time quotes, trading community, and is also insured and protected against loss by SIPC. Opening a Zecco account to benefit from $0 Stock/ETF trading is a smart idea. Free stock trades allow you to preserve more of your wealth and save money, which you can invest instead of paying brokerage commissions.

For knowledge we can highly recommend you subscribe to the The Wall Street Journal.

Bookmark this page (CTRL+D) :