Value stocks typically trade at cheaper prices relative to fundamental measures of value, such as earnings and the book value of assets. In contrast, growth stocks tend to run at higher valuations since investors expect the rapid growth in those company measures.
Investors are typically more aggressive during periods of heightened volatility and would chase popular growth stocks. Since growth stocks show high multiples, investors may expect that the companies will sustain a high growth rate.
“The Schwab U.S. Large-Cap Growth ETF is one of the growth ETFs that ascended to a new high Tuesday and it is one of a small amount of growth ETFs to see robust inflows to start 2017. Year-to-date, investors have funneled nearly $144 million into SCHG,” adds Investopedia.
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