"The U.S. equity market may continue to perform better than most other developed markets," Doll says. "Thus far, the U.S. market has weathered the downturn relatively well. We expect U.S. stocks to continue to outperform in the current environment since the U.S. is more generally a defensive market."
While growth stock performance has held up better than value stocks', many growth companies still face a lot of financial pressure.

Stephen Lurito, a chief investment officer of American Century, does not expect stellar returns from growth stocks over the next year. He was expecting several months of negative earnings reports. As a result, he is trying to invest in growth companies that have maintained earnings and have outperformed value stocks and the overall market.

The average holding in the American Century Growth Investment Fund is growing earnings at more than 22% annually. Plus, the sales growth and cash-flow growth of the average holding are in the double digits. The fund has outperformed the S&P 500 over the past three months to five years. Over the past year, the fund outpaced the S&P 500 by ten percentage points in total return. Through mid-August, the fund's average top ten holdings were up 7.6%.

About one-fourth of the stocks in the portfolio are midcap growth. The rest are large caps. The fund increased the purchase of stocks such as Qualcomm, Wal-Mart Stores, Emerson Electric and Honeywell International. It recently purchased Helmerich & Payne Inc., a U.S. oil and gas driller with more than 200 drilling rigs. The company is selling at just 10.3 times next year's earnings, while 2009 earnings were expected to grow about 26%.

"We see real challenges for U.S. consumers and the need to repair balance sheets through increased savings," Lurito says. "But we believe that cyclical variations in the U.S. economy can only slow, not stop, the long-term secular trend toward rising global living standards and development."

Over the long term, value stocks could outperform growth. But Grant Rawdin, president of Wescott Financial Advisory Group LLC in Philadelphia, says investors must have a lot of patience. In the long term, the investment will pay off. But in the near term, value stocks should underperform.

"It is important to remember that our value managers seize opportunities to make investments in out-of-favor companies," he says. "During 2008, this has meant investments in financial companies that have experienced sharp price declines. In the short term, the investments made in financials during the past year have significantly detracted from [our] results, year to date."

There are a lot of mispriced growth-oriented stocks in industries such as chemicals, fertilizer and agricultural equipment; in tankers and shipping containers; in infrastructure for airports and seaports; and in materials for roads, bridges and communities in Asia and the developing economies. As a result, companies such as Alcoa, Boeing, Caterpillar, DuPont and United Technologies benefit most from these trends.

"2008 has been an interesting year," Rawdin says. "We expect the mood of the market to improve once the murkiness of the financial sector clears and the election is over. During the interim, we will take advantage of bear market conditions for as long as they last to deploy new investments in our rebalancing of portfolios."

Ron Sweet, an equity investment strategist with USAA Investment Management Company in San Antonio, is not overly optimistic about growth stocks. He cites the sell-off in financials as the primary reason growth has outperformed value. As a result, USAA is taking a slightly neutral stance toward growth stocks, which he says are fairly priced.