![]() Growth investors chase stocks that have the potential to be above-average performers. Value investing can be beneficial in many ways but requires due diligence on the part of investors to make it a success.īenefits of value investing: It is a low-risk, high-reward strategy taps into the power of compounding is suitable for investors across different income groups increases your exposure to blue chip companies.įor this approach to be successful, you require a lot of patience, a thorough understanding of the business you are investing in and the know-how to estimate the correct intrinsic value of stocks. It involves identifying undervalued stocks and investing in them today so that when the prices correct to reflect the intrinsic value later, the investor can profit from the price movement. This approach sums up what value investing is all about. Over time, the market participants expect such stock prices to rise, reflecting their inherent value and leading to capital appreciation for the investor. In some cases, the market price of the listed stock tends to be lower when compared to its intrinsic value, making them undervalued. By selecting the strategy best suited for their needs, investors can make all the difference to their portfolios.īut how to know which route is the better option for you in today’s market conditions? Well, to decipher that, let’s see what each strategy entails.Įvery stock listed in the market has an intrinsic or true value determined through fundamental analysis. Of the many investment techniques available, value investing and growth investing are pretty popular amongst investors. ![]() These strategies vary based on each investor’s goals, financial capacity, and risk profile. Interested market participants have always employed different investment strategies to choose the best possible securities for their portfolios. There is no single right way to invest in the stock market.
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