Growth investing

Growth investing is an investment approach that focuses on stocks with above average capital appreciation. Those who follow this style, known as growth investors, invest in companies that exhibit signs of above-average growth, even if the share price appears expensive in terms of fundamental metrics such as price-to-earnings (P/E) or price-to-book (P/B) ratios. In typical usage, the term "growth investing" contrasts with the strategy known as value investing.

Since the bursting of the dotcom bubble, growth investing is less popular. An alternative, or refinement, is known as growth at a reasonable price (GARP) which blends aspects of growth and value investing. Investors seeking growth at a reasonable price look for stocks that they believe will deliver above-average growth, but that are not too expensive.

Notable investors such as Warren Buffett have stated that there is no theoretical difference between the concepts of value and growth ("Growth and Value Investing are joined at the hip"), as growth is always a component in the calculation of value, constituting a variable whose importance can range from negligible to enormous and whose impact can be negative as well as positive.