In this article we are going to go over all about growth stocks. In pervious articles I went over Are Dividend Stocks Worth Investing In? and REIT Dividend Investing This article will be about the other side of it called growth stocks.

What Are Growth Stocks?

Investing in a “growth” style stock often means little to no dividend yield. Instead it’s expected that the company will continue to grow and as it does the company will do what is known as reinvesting the earnings into the company itself. This is geared to accelerate growth of that company which in turn should increase the stocks value quickly over a short period of time.

Investment Options

There’s two main ways to go about investing into growth stocks. The first being finding each company you believe will do well and investing directly into their stock. This can be very hit or miss and even after doing your own research could fall off or explode in value. It’s almost a lot of luck. However another option to invest like this would be through funds or ETFs that pool a number of stocks together into a growth style ETF.

Let’s take a moment and look over a few options we currently have.

#1 MSFT Microsoft Corporation

Over the last 5 years this stock has gone from $115 to now $340. It pays a very small dividend yield of under 1% however the growth value on this stock has been a staple for long term investing. A growth stock such as this shows you some serious value as over a 5 year span holding the stock would have increased your net worth by over 100%. While a high risk dividend stock of 20% would be needed for nearly the same results. Microsoft continues to be a staple for many.

#2 AMZN Amazon.com Inc

Amazon was once the go to stock to invest in. However if we look over the last 5 years the stock really hasn’t moved much and often seems to struggle. It’s also important to note that at the time of writing this many of these growth stocks are currently valued as overvalued being the price the stock has to what it should be is very high.

#3 GOOGL Alphabet Inc.

Google otherwise known as Alphabet on the stock market has done well. However you’ll start to notice that many of these large cap growth companies seem to be struggling in the current economy. Personally I feel like these stocks should still be good options as high inflation starts to be removed and interest rates start to return to normal over the next few years.

#4 NVDA NVIDIA Corporation

Nvidia has had a wild track record. The stock exploded over the last 3 years due to Ethereum and everyone wanting GPUs to mine Ethereum with but also the gaming space and streaming was kicking off. This created a huge strain on the GPU economy, skyrocketing prices to all new highs. It wasn’t until Ethereum changed to proof of stake that the prices began to fall. But all that capital was pushed into a new smart move which was AI focused and now has set the company up for even larger success. Personally I knew this was going to be a good investment as Ethereum and crypto prices started to shoot up which took the stock from mid $30’s to low $300’s from there it dropped to roughly $150 but with the AI boon it’s skyrocketing towards $500. It might be a risky bet getting into this stock right now as It’s most likely highly overvalued. But it’s impossible to predict what people will buy these days.

#5 VONG Vanguard Russell 1000 Growth Index Fund

Another option could be getting into large cap index funds such as the VONG. You’ll see this stock follows many of the other single stocks but is a little more flat curved as the funds are spread out over many stocks instead of a single one. It also pays just under 1% dividend yield and for the most part has had rather steady growth numbers.

Of course with any of these comes risk, chance and the hopes that they do great. *This article is for entertainment purposes only and is not financial advice.

Growth stocks can be a powerful asset to have in your investment portfolio adding value to your investment quickly instead of a long term steady dividend portfolio which seems to come at a much higher risk.

Posted Using LeoFinance Alpha