October 2007
growth, value or blend
When it comes to investing, growth and value both sound like desirable traits. But in the world of equity investments, growth and value are the names given to two rather different styles of investing. A third style, blend, is just what its name says: a blend of the growth and value approaches. Understanding a little about each style may help you select mutual funds that are appropriate for you.
Growth funds include the purchase of stocks that are considered to have above-average prospects for long-term price appreciation. They may be expensive, with high price-to-earnings ratios, but the growth fund manager believes the prices will continue to rise.
Although past performance is not an indication of future results, growth funds have tended to do better during bull (rising) markets, and value funds have frequently outperformed growth funds during bear (falling) markets.
Value fund managers generally seek stocks that have been overlooked by the market, those experiencing temporary setbacks or showing potential for turnaround in an industry that’s currently unpopular. Value funds include the purchase of value stocks at bargain prices, with the expectation that the value will go up.
Growth and value funds don’t always react the same to the ups and downs of the market, so it can make sense to invest in a balance of the two or consider a blended fund. Be aware, however, that blended funds may lean more heavily toward growth or value, so research options carefully.
One of our Financial Advisors, available through CUSO Financial Services*, L.P., our broker/dealer, can help you choose funds that are appropriate for your portfolio based on your goals, timeline and risk tolerance.
To contact one of our Financial Advisors, please call
800.358.8228 (Option 5) or visit our Web site at
www.patelco.org/FinancialAdvisors.
Investment products and services offered through CUSO Financial Services, L.P. (CFS), are not insured by American Share Insurance (ASI) (the Credit Union’s private share insurer), are not NCUA/NCUSIF insured, are not Credit Union guaranteed, and may lose value. Financial Advisors are employees of Patelco Credit Union and registered through CFS. Patelco Credit Union is in partnership with CFS. Member NASD/SIPC.
156 Second Street, San Francisco, CA 94105
Copyright © 2007, Patelco Credit Union.
