Image source: Games Workshop plc
For much of the last two years, growth stocks have taken a back seat. High inflation, rising interest rates, and nervous investors drove a shift towards value and defensive sectors. But with inflation now easing and rate hikes likely near their peak, are UK growth stocks finally staging a comeback?
It’s still early days, but the signs are encouraging. The FTSE 250, home to many of Britain’s best growth names, has begun to outperform the FTSE 100 in recent months. That’s typically a sign that investors are starting to favour riskier, faster-growing businesses again.
Why growth stocks struggled
Growth stocks often promise strong future earnings, but much of that value’s tied up in projections. When interest rates rise, those future profits are discounted more heavily, making growth shares look less attractive compared to steady,…
