Value Investing
Buy businesses for less than they're worth; let the gap close. Simple to state, brutal to practice.
The Major SchoolsIntermediate 6 min read· Lesson 1 of 5 in Investing Strategies
The idea
Price and value diverge because markets overreact. Value investors estimate intrinsic worth (earnings power, assets, cash flows), buy at a discount — the 'margin of safety' — and wait. Low P/E, low P/B, high FCF-yield screens are the quantitative shadow of this idea, and historically carried a return premium.
The hard part
Cheap stocks are usually cheap for visible reasons — the skill is separating temporary problems from terminal ones ('value traps'). Check: is the balance sheet survivable (Debt/Equity), is FCF real, is the moat intact? The Company Fundamentals course covers each tool.
Practicing it here
Rank a stock list by fundamentals you've synced, then study survivors' charts for accumulation bases — value for the thesis, technicals for the timing.