What is Value Investing? Know about Value Investment
🔶What is value investing?
It is an investing strategy practiced by Warren Buffet that involves picking stocks that appear to be trading for less than their intrinsic value.
As a value investor, we focus on the business's long term fundamentals instead of the stock price because the stock price does not correspond to the company’s fundamentals.
The concept behind value investing is pretty simple and straightforward. It basically means that if you know the true value, or what we call the intrinsic value, of a company -> you can save lots of money by buying it at an undervalued price.
In other words, we are more willing to buy the same thing with the same quality at a sale price instead of the full price.
Before this value, investing was first introduced by Benjamin Graham (Mentor of Warren) in the 1920s.
Which emphasis is placed on the number and the market demand and supply for any stock?
Buy any stock as long as it sum undervalued
But with time, Warren Buffet thought the strategy introduced by Benjamin had weaknesses.
So Warren Buffet improved and created the second generation of value investing by looking at a company and business as a whole, which retained the basic concepts of value investing such as intrinsic value and margin of safety, and this is basically the background of value investing.
Though it has been introduced for many years, it is still one of the most famous investing strategies considered by many investors.
Further in the series we will be discussing some methods and all the methods and strategy to become a good value investor and how to invest your money properly with the positive outcomes.
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