Inflection Points: Credit Crunch May Not Deliver Market PunchEditor’s Note: Inflection Points is a monthly series intended to explore the underlying trends, dynamics and opportunities shaping the thematic investing landscape. Technology and growth stocks, perceived to be at risk in a credit contraction, actually show better growth with lower leverage levels than the broader market. A History of Credit Crunches and Market GainsQuite simply, credit contraction is bad for economic growth. The relative outperformance of growth in periods of credit contraction should not be surprising, as growth stocks typically have lower leverage than the broader market. Growth companies are unlikely to be immune from the credit contraction, but the credit contraction might not be as tech-focused as some market participants think.

Source: Forbes April 10, 2023 16:02 UTC