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Is now the perfect time to buy ASX growth shares?

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A man points at a paper as he holds an alarm clock, indicating the ex-dividend date is approaching.

It is not always comfortable buying ASX growth shares during periods of market volatility.

In fact, it often feels easiest to buy them when prices are rising and confidence is high. The story sounds better, the outlook feels clearer, and momentum is on your side.

But that is usually not when the best long-term opportunities appear.

After the recent pullback in global markets, I find myself looking at growth shares a little closer. Because this is often when sentiment and fundamentals start to diverge.

When great ASX growth shares are marked down

One thing I have noticed over time is that high-quality ASX growth shares rarely stay cheap for long.

But they do get sold off.

Sometimes it is because of rising interest rates. Sometimes it is macro uncertainty. And sometimes it is simply a shift in market mood.

Businesses like Wisetech Global Ltd (ASX: WTC), TechnologyOne Ltd (ASX: TNE), and Life360 Inc. (ASX: 360) have all seen their share prices pull back despite continuing to execute operationally.

That disconnect is what I find interesting.

Because if the long-term outlook remains intact, a lower share price can quietly improve future return potential.

The trade-off never really disappears

That said, I do not think growth investing suddenly becomes easy just because prices fall.

The trade-off is always there.

You are often paying a premium for companies that are expected to grow strongly into the future. That means expectations matter. Execution matters. And sentiment can shift quickly.

Even after a correction, many growth shares are not cheap in a traditional sense.

But I think that misses the point slightly.

For me, the question is less about whether a stock looks cheap today and more about whether the business can be meaningfully larger and more profitable in five or ten years.

Why I think this environment is interesting

What makes the current environment stand out to me is the combination of uncertainty and structural growth.

On one hand, there are still macro concerns floating around. Interest rates, artificial intelligence (AI) concerns, global growth fears, and market volatility have not disappeared.

On the other hand, many of the long-term drivers behind growth companies remain intact.

Digital transformation is still ongoing. Healthcare innovation continues. Enterprise software adoption is not slowing down.

That tension can create opportunities.

Not obvious ones. Not risk-free ones. But opportunities to build positions in businesses that might otherwise always feel just out of reach.

How I would approach it

If I were looking at ASX growth shares today, I would focus on building positions gradually.

Adding over time helps smooth out volatility and removes the pressure of needing to get the timing exactly right.

I would also stay selective.

Not every company that falls is a good opportunity. For me, it comes back to quality. Strong balance sheets, clear competitive advantages, and a track record of execution.

That is what gives me confidence to hold through the inevitable ups and downs.

Foolish takeaway

Growth investing never really feels easy, and that is probably a good thing.

Right now, I think we are in one of those periods where high-quality ASX growth shares are being viewed with a bit more caution.

For long-term investors, that can be an opportunity because the gap between sentiment and long-term potential may be starting to open up again.

The post Is now the perfect time to buy ASX growth shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360, Technology One, and WiseTech Global. The Motley Fool Australia has positions in and has recommended Life360 and WiseTech Global. The Motley Fool Australia has recommended Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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