Value Investing

Buying securities trading below estimated intrinsic value.

In depth

Pioneered by Benjamin Graham, popularized by Warren Buffett. Value factor (low P/B, P/E) underperformed growth for over a decade pre-2022 but is one of the most academically validated long-term return premiums.

Related terms

P/E Ratio (Price-to-Earnings)

A stock's price divided by its earnings per share — the most common valuation metric.

Price-to-Book (P/B)

Stock price divided by book value per share.

Factor Investing

Investing based on persistent characteristics that drive returns: value, momentum, quality, size, low-volatility.

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