{"id":1010,"date":"2021-06-17T23:55:00","date_gmt":"2021-06-17T15:55:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=1010"},"modified":"2025-12-10T11:20:26","modified_gmt":"2025-12-10T03:20:26","slug":"why-i-prefer-growth-stocks-instead-of-value-stocks","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/17\/why-i-prefer-growth-stocks-instead-of-value-stocks\/","title":{"rendered":"Why I prefer growth stocks instead of value stocks?"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/17\/why-i-prefer-growth-stocks-instead-of-value-stocks\/#The_weird_investment_preference_of_Taiwanese\" >The weird investment preference of Taiwanese<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/17\/why-i-prefer-growth-stocks-instead-of-value-stocks\/#Short-sighted_but_fatal_investment_method\" >Short-sighted but fatal investment method<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/17\/why-i-prefer-growth-stocks-instead-of-value-stocks\/#Deposited_shares_and_long-term_growth_stocks_investment%E2%80%9D_are_different\" >Deposited shares and long-term growth stocks investment&#8221; are different<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/17\/why-i-prefer-growth-stocks-instead-of-value-stocks\/#Reasons_to_favor_growth_stocks\" >Reasons to favor growth stocks<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/17\/why-i-prefer-growth-stocks-instead-of-value-stocks\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_weird_investment_preference_of_Taiwanese\"><\/span><strong>The weird investment preference of Taiwanese<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Most investors in Taiwan generally believe that &#8220;deposit stocks&#8221; should be value stocks and exclude high-volatility growth stocks; I think it is mainly related to the investment habits of Taiwanese investors. How to say? Taiwanese investors have the following three extremely special preferences, all of which are fatal (compared to other countries, these three are almost the unique investment habits of Taiwanese investors):<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Any investment product must have a fixed coupon.<\/li>\n\n\n\n<li>Any investment product must be able to repay the capital.<\/li>\n\n\n\n<li>Investment in the stock market is only valued by the P\/E ratio. You are welcome to refer to my other blog post on &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/08\/07\/us-and-taiwan-stocks-investors-have-very-different-valuation-methods\/\" target=\"_blank\" rel=\"noreferrer noopener\">U.S. stocks and Taiwan stocks investors\u2019 valuation methods are completely different<\/a>&#8220;.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<p>Taiwanese are generally unmoved by the warnings that inflation will eat up your deposits and principal, based on the global trend of low or negative interest rates, the basic principles of economics. Any currency-based financial management method that is not recommended abroad is a basic equipment in Taiwan. As long as any investing product that cannot generate a fixed dividend, it will basically not be sold in Taiwan.<\/p>\n\n\n\n<p>You only need to think about why Taiwan is the country with the most proliferation of whole life insurance in the world. The whole life insurance designed specifically for Taiwan is actually an annuity, and it has completely lost the meaning of insurance. For a dozen years straight, <a href=\"https:\/\/english.cw.com.tw\/article\/article.action?id=2711\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/english.cw.com.tw\/article\/article.action?id=2711\" rel=\"noreferrer noopener\">insurance premiums have amounted to 17.48 percent of Taiwan\u2019s GDP, the highest ratio in the world<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Short-sighted_but_fatal_investment_method\"><\/span><strong>Short-sighted but fatal investment method<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Because of this habit, most investors in Taiwan are only willing to choose groups with low stock price fluctuations when depositing shares. To put it bluntly, bank stocks, telecommunications stocks, people\u2019s livelihood products, and food stocks are very safe and high dividend-paying blue chip stocks (most of them are also called value stocks); this is the investment target of most pension funds or retirement groups in the US stock markets. <\/p>\n\n\n\n<p>In fact, the growth of these stocks is very low, and many even lag behind the market performance, that is, the stock price will hardly rise. Investing in these stocks is not bad, but it wastes the biggest advantage of stock investment in all common asset classes-the long-term return rate will definitely exceed other common asset classes (such as gold, real estate, bonds, currency funds).<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Deposited_shares_and_long-term_growth_stocks_investment%E2%80%9D_are_different\"><\/span><strong>Deposited shares and long-term growth stocks investment&#8221; are different<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Going back to the subject of this article; the same thing between the two (&#8220;deposited stocks&#8221; and &#8220;long-term investment growth stocks&#8221;) is that they encourage long-term investment. Both of these investment mentalities are correct. The differences between the two are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The term \u201cdeposited shares\u201d used by Taiwanese is relatively conservative; they tend to have stable stock prices and dividends, which are value stocks in the eyes of most people; these stocks often underperform the market, which means that your principal may be possible in the long run will shrink, even if there is a dividend, it will not be able to make up for it. Depositors only want dividends. Investors should face up to the fact that dividends can&#8217;t make much money. Don&#8217;t lose big because of small gain on dividends and ignore the growth of stock prices. This investment method can be fatal when used in US stocks.<\/li>\n\n\n\n<li>The idea of super growth stocks is to lock in industries that investors are more familiar with, focusing on long-term competitiveness, market potential, and profitability; after buying, they will not move to enjoy the long-term compound interest of excellent companies and stocks. Growth stocks in the U.S. stock market, especially the technology industry, basically do not pay dividends, and such investors do not expect dividends.<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"125\" height=\"87\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/09\/growth-stocks-1600x1200-1.jpg\" alt=\"growth stocks\" class=\"wp-image-14146\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Reasons_to_favor_growth_stocks\"><\/span><strong>Reasons to favor growth stocks<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The reasons why I particularly like growth stocks are as follows: <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The value of an enterprise is directly proportional to its future growth prospects.<\/li>\n\n\n\n<li>Inflation will eat up fixed income assets: dividends, cash, bonds; and your salary income.<\/li>\n\n\n\n<li>Investing in growth stocks can enjoy the benefits of long-term compound interest as the company&#8217;s business grows.<\/li>\n\n\n\n<li>Only two or three outstanding growth stocks needed in your lifetime, and investors will be very wealthy.<\/li>\n\n\n\n<li>Investors in US stocks view the performance of listed companies in a fundamentally different way from Taiwan stocks: they favor high-revenue growth companies.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li> &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/17\/why-i-prefer-growth-stocks-instead-of-value-stocks\/\">Why I prefer growth stocks instead of value stocks?<\/a>&#8221; <\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/12\/08\/investing-for-growth\/\">Investing for growth<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/04\/07\/buffett-deserves-study\/\" target=\"_blank\" rel=\"noreferrer noopener\">Why Buffett deserves further study?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/23\/value-investing\/\" target=\"_blank\" rel=\"noreferrer noopener\">The past and present of value investing<\/a>&#8220;<\/li>\n\n\n\n<li><a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/11\/07\/cigar-butt-investment\/\" target=\"_blank\" rel=\"noreferrer noopener\">&#8220;Problems with Cigar Butt Investment<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em><strong>Disclaimer<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Why I prefer growth stocks instead of value stocks?<\/p>\n","protected":false},"author":1,"featured_media":14146,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33,321,179,1151,163,174,405,13,35,177,23,28,32,34],"tags":[],"class_list":["post-1010","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-growth-investing","category-bond","category-cash","category-compound-interest","category-dividend","category-eps","category-inflation","category-investing-behavior","category-long-term-investing","category-revenue","category-taiwan-stock-market","category-us-stock-market","category-value-investing","category-wealth-management"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/1010","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=1010"}],"version-history":[{"count":23,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/1010\/revisions"}],"predecessor-version":[{"id":40554,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/1010\/revisions\/40554"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/14146"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=1010"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=1010"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=1010"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}