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Comment on Why Growth Stocks Aren't Growing, and Other Problems with the Growth Indexes and ETFs (IVE, IVW)
by XTF Advisors
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    There are studies that show the slope of the yield curve plays a role in the growth value issue. A steeper curve allows mature "value" companies to access capital markets through debt offerings, steeper curve= favorable conditions for successful bond issues. A flatter curve allows less mature "growth" companies to access capital throught secondary stock offerings. Stock offerings would be too dilutive to a more mature company and a flatter curve makes secondaries more appealing when debt is less so.

    While this all sounds good to me it is odd that this notion hasn't helped growth very much lately, but I think its worth knowing.
    2005 Sep 13 01:12 PM Reply