During the past two months there have been a large number of growth stocks go parabolic.
Parabolic means a stock which was rising steadily then climbs at a more rapid rate, perhaps rising 50%-100% in 3-to-6 months.
These stocks are great if you own them. If you don’t then you are missing out and may be tempted to buy high.
Buying after a parabolic move can be dangerous, because a correction in the stock market could cause the hot-stocks to decline around 2x the rate of the stock market.
There’s measurements in regards to Growth Stocks (young rapid growers) vs. Value Stocks (old stable businesses with stocks that can pay dividends). During the past month Growth vs. Value has been at the highest point ever, meaning growth is in, value is out.
Growth stocks are the place to be, but savvy investors are smart to pick up Blue Chips on a dip.
