Guide to Analysing Companies

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GROWTH STOCK
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(mutual fund) which seeks above-average growth by
holding the shares of growth stocks. (See also value stock.)
Growth investing
A type of investing that relies on capital gain from holding
(and then selling) growth stocks (that is, those whose
earnings grow more rapidly than the average for the market
as a whole). The opposite of growth investing is value in-
vesting, in which investors seek to profit from stocks that are
undervalued compared with the average for the market as a
whole and which generally offer a bigger income in the form of
dividends.
Guarantee
An undertaking by a third party to be responsible for a liabil-
ity (a loan from a bank, for instance) should the party to the
liability be unable or unwilling to meet the liability on time. To
be legally binding, a guarantee must be in writing.
A guarantee differs from an indemnity in the nature of the
undertaking. With an indemnity a guarantor takes on collateral
responsibility; that is, the same degree of responsibility as the
person he or she is guaranteeing. Should the person die, then so
does the guarantor’s responsibility.
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GROWTH INVESTING
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Hh
Hammering
An old expression for the failure of a member firm of the
london stock exchange. An employee of the exchange
would hammer for silence on the floor before making an an-
nouncement of a member firm’s troubles. In the United States,
hammering has come to refer to intense selling pressure on a
market, when investors believe prices are too high.