What is Value Investing :
The stocks which trade below its intrinsic value are called undervalued stocks or value stocks. The value investors are those who actively look out for stocks that they believe are in the undervalued state.
Investors who use this strategy have the fundamental belief that the market overreacts to good and bad news, which as a result, move the stock price. In the case of undervalued stocks, these movements do not agree with a company’s long-term fundamentals, providing an occasion to profit when the price is deflated.
ANALYZING INTRINSIC VALUE OF STOCK :
There are Many metrics you can use to evaluate the stock like –
- Price To Book
- Price To Earning – P/E Ratio
- PEG – Price To Earning To Growth
- ROE – Return on Equity
- Debt To Equity Ratio
🔷️CURRENTLY MANY GOOD QUALITY MIDCAPS & SMALLCAP OFFERS THE BUSSINESS AT DISCOUNT TO FAIR VALUE AS SENTIMENTS ARE NOT IN FAVOUR.
🔷️BUYING WHEN MARKETS OR STOCK OFFERS THE BUSSINESS AT A DISCOUNT TO FAIR VALUE IS MOSTLY REWARDING IN LONGTERM.
🔷️ONE SHOULD START SIP IN QUALITY STOCKS FOR LONG TERM INVESTMENT AS MANY GOOD BUSSINESS ARE AVAILABLE AT HUGE DISCOUNT TO THERE FAIR VALUE AND ALMOST UPTO 50% TO 75% DISCOUNT FROM THERE 18 MONTHS HIGH
Disc – All views expressed are personal and only for Educational and study purpose. Consult your financial advisor before investing or taking any position based on above article.