Eric Jackson, EMJ Capital founder, joins ‘Closing Bell: Overtime’ to discuss his bullish case for growth stocks and small caps. For access to live and exclusive video from CNBC subscribe to CNBC PRO:
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LEARN ABOUT: Investing During Inflation
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Investors should consider including growth stocks in their portfolio as inflation rates continue to decrease, according to Eric Jackson, the founder and CEO of EMJ Capital Ltd.
Inflation has been a major concern for investors over the past year, as the global economy began to recover from the impact of the COVID-19 pandemic. Rising prices and increased cost pressures have heightened fears of eroding purchasing power and rising interest rates. However, recent data suggests that inflation may be easing, which presents an opportunity for investors to reassess their strategies.
Eric Jackson argues that growth stocks are particularly well-positioned to benefit from a low inflation environment. Growth stocks are companies expected to expand their earnings and revenues at an above-average rate compared to the overall market. These companies often operate in fast-growing sectors, such as technology, healthcare, and renewable energy, and their valuations are often driven by their potential future growth rather than their current profitability.
When inflation decreases, interest rates tend to follow suit. Lower interest rates are beneficial for growth companies as they reduce borrowing costs, making it easier for these companies to finance their expansion plans. Additionally, lower interest rates make growth stocks relatively more attractive compared to fixed-income investments like bonds or savings accounts, which offer lower returns in a low inflation environment.
Furthermore, as inflation declines, consumers’ purchasing power strengthens. This often leads to increased discretionary spending, particularly in areas like technology and consumer-oriented industries. Growth companies that serve these sectors can experience accelerated demand for their products and services, driving revenue and earnings growth.
However, it is important to note that not all growth stocks are created equal, and investors should carefully analyze individual companies before making investment decisions. Some growth stocks may be overvalued, and investors should consider whether the future growth prospects of a company justify its current stock price. Thorough analysis of financial statements, market trends, and competitive positions is crucial for identifying quality growth stocks.
Investors may also want to diversify their growth stock holdings across different industries and regions to spread risk and reduce the impact of any potential downturns in specific sectors. Diversification ensures that investors are not overly exposed to a single company or sector’s performance.
In conclusion, Eric Jackson advises investors to have exposure to growth stocks as inflation rates decrease. These companies can benefit from lower interest rates, increased discretionary spending, and a favorable environment for potential future growth. However, investors should approach growth stock investing with due diligence and consider diversification to manage risks effectively. By carefully selecting quality growth stocks, investors can position themselves to capitalize on the opportunities presented by a low inflation environment.
Don't listen to any of these snake oil traders on TV.
Clown
Always buying, as much as i can.
This pandemic made me realize how important investment really is, I am 35 this year a business owner here in Australia with no investments and that is not good , as a beginner in the stock market am finding it difficult to invest right now, I don't have the time and the market is also not very stable, I really need to invest my earning in stock market, I know now is the right time.
For me , I'm currently viewing the current market as a giant opportunity for making generational wealth, thinking about invsting into stocks or digital-asset but how are we going to achieve all that given that the market has being a mess most of the year seems farfetched
I smell something. It’s BS.
Stocks are rising Wednesday as US Treasury yields slip back from recent highs. My spouse and I have been quite unsure about investing in this current market and at the same time I feel it's the best time to get started on the market, heard some guy speaking of making over $460,000 in 8 months from an initial capital of $87k invested in meme stocks and I'm driven to ask what skillet and strategy can generate such profit.
The way you just went right into the segment was great. Straight news. Zero fluff. This was one of your best streams. More emphasis should be put into trading since it is way profitable than hodling. Trading went smooth for me as I was able to raise over 10.2BTC when I started at 4.5BTC in just few months implementing Melisa pamela perez daily trading signals and tips.
Uber
This guy is going to get rekt.
MY FINANCIAL GOAL IS TO BE MAKING AT LEAST UP TO $1,000,000 EVERY YEAR BY INVESTING HEAVILY BOTH IN CRYPTO AND STOCK. I NEED GUIDIANCE. please comment below…
Can't compare TWLO p/s ratio to CRM.
I bet market is sniffing too much
Twlo and Uber mehhhh. Pass.
How about AMD and NEE? Ok
We should buy growth so you and your buddies could unload? No thanks
If rates continue to rise along with the dollar growth going to continue to get washed out.
0:40 "going into the second half of this year" — there are only 4 months left lol
What a miserable year it's been (in terms of stocks) for me.
Lost all my gains and then some from 2020/2021.
I remember when Fed rate hikes were announced in January, I had no idea it would be 9 months (and more) of downtrend.
I thought the -2% or -3% drop on announcement day was all there was going to be.
Note: I only started investing during the Covid summer of 2020,
so, I really had no idea rate hikes would cause so much damage.
Haha inflation coming down, the Trillion dollars being printed in latest spending bill will make it go up higher.
America #1 stocks go up
Inflation coming down which will slow the rate hikes market will be rising soon
Look for three lower bottoms before fed capitulates in 2024.
You have to be bullish when everyone is so bearish,for real? and they will pull rug as soon as everyone on board. Gtfoh
Prepare for tough times but hedge against a soft landing. lol. I see nothing wrong with that
I like this guy. “People slit their wrists again” lmao he don’t hold back
Can you make a video explaining how beginners can make huge profit within a short period of time? I mean i was at a seminar and the host spoke about making well over $880,000 within 4months of investing $150,000 i just need to know how.
Data is in USA open up ahead of supply causing inflation