What is Value Investing

What is Value Investing

**Value investing is like buying X'mas cards in the month of January OR buying clothes during a New Year Sale. You need to have patience and wait till the sales cycle hits a low and then start your purchases.Similarly in the stock market, we need to buy when the charts (based on price/volume/other indicators are favorable). Stocks work the same way. Clothes go on sale several times a year. However stocks will not be on sale at predictable times of year lIn general, most of us tend to buy in a Supermarket sale. However when it comes to stocks, most people panic/have fear when stocks are on sale. If you're willing to do the detective work tofind these secret sales, you can get stocks at bargain prices that other investors will be oblivious to.
*In value investing, you buy when prices are low relative to fundamentals (Eg: earnings and book value and then wait for prices to go up).
*Value investing is you buy low and sell high. Buy in panic and sell in mania
*A value investor should spend more time at the beach than at the office
*Value investing does somewhat better during down market times and does not appreciate more during up-market months
*Value investing, by its very nature, is about the gradual appreci- ation of capital.
Value investing is a comprehen- sive investment philosophy that emphasizes the need to perform intense fundamental analysis, pursue long-term investment results, minimize risk, and, above all, resist herd mentality.
*Along with reduced trading mistakes, a patient Value investment approach minimizes transaction costs.
*Value investor needs to be disciplined, patient, have cash, not greedy in leverage, have humility. Just as it is silly to think that a fundamentally sound business can lose 15 per-cent of its value in a single day, the same thinking is applied to stock prices that experience extreme bouts of price volatility.
*Value investor needs to buy stocks when undervalued and sell when overvalued
*Value stock outperforms growth stocks over a long period of time
*Value investing relies on fundamental analysis value
*Value investors are bargain hunters
*Most stocks follow"regression to the means". Hence Value investors do well in their investments

• Value investing must be based on an assessment of the relationship between price & value
  *In Value investing, the Asset grows in value when you hold it. An asset will continue to put money into your pocket
  *In Value Investing, Profit is made when you buy the stock at the correct price.