Growth stocks outperform value stocks, but experts are divided on performance in 2025

From Nasdaq: 2024-12-29 10:00:00

In 2024, growth stocks have once again outperformed value stocks, with the Vanguard Growth ETF (VUG) showing a 15.6% average annual return compared to the Vanguard Value ETF (VTV) at 10.8% over the past decade. The Growth ETF has outperformed the Value ETF in eight of the past 10 years, indicating a trend favoring growth stocks.

Looking ahead to 2025, there is speculation that the environment could be favorable for value stocks due to their cyclical nature and sensitivity to interest rates. However, growth stocks, particularly those focusing on artificial intelligence technology, continue to dominate the market. Despite this, there is a case for value stocks based on the concentration of top holdings in the Growth ETF, particularly Apple.

While there are arguments for both growth and value stocks in the coming year, some experts lean towards growth stocks due to the potential of AI technology and attractive pricing of top growth stocks in the Growth ETF. However, the balance between growth and value stocks may shift depending on various factors in the market.



Read more at Nasdaq: Vanguard Growth ETF vs. Vanguard Value ETF: Which ETF Will Outperform in 2025?