There are special risks involved in buying “growth stocks” when the market has already recognized the growth and has bid up the price-earnings multiple to a hefty premium over that accorded more run-of-the-mill stocks. The problem is that the very high multiples may already fully reflect the growth that is anticipated, and if the growth does not materialize and earnings in fact go down (or even grow more slowly than expected), you will take a very unpleasant bath.
