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The Motley Fool fool.com 05 Aug, 2022 15:30 am

Should You Really Be Buying Beaten-Down Growth Stocks Right Now?

Should You Really Be Buying Beaten-Down Growth Stocks Right Now?
Now's a great time to invest in companies with the potential to grow significantly in the long term.

Let's examine a few arguments in favor of sitting out on growth stocks until the bear market resides and a few in favor of continuing to buy them.The most straightforward reason investors might want to stop buying growth stocks right now is that the bear market is absolutely brutal to their share prices.In short, growth stocks are heavily disfavored in the context of the current bear market because investors expect the Federal Reserve to keep hiking interest rates, thereby making it more expensive for companies to borrow money.All of the above is why many investors are choosing not to buy shares of growth stocks right now.

Still, gobbling up wounded growth stocks in biotech specifically is probably best left to the investors who can tolerate a three-course meal's worth of risk.But if you're optimistic about the future and want to get a deal, there's no reason to stop buying growth stocks at the moment, so long as you stick to investing in quality companies.

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