What does “investment style” mean?
This generally refers to two types of stock: growth or value. A growth stock is one whose earnings potential is considered above average, based on such factors as earnings history and competitive position in its industry. A value stock is one that is considered under-pricedor, quite simply, a bargaingiven its company’s fundamental strengths. Many stock mutual funds are referred to as growth or value funds, and investment professionals consider such styles to have different cycles. Growth stocks, for instance, tend to lead other stocks when the market and economy are strong. Value stocks, on the other hand, are favored when the market is in a slump and good stocks may be under-priced because many investors aren’t buying or “bidding up” stocks. Holding both value and growth stock funds allows you to participate in each market cycle.
