What Are Value Based Investing Strategies?
Value based investing strategies involve buying companies that are considered undervalued and holding them for the longer term. It focuses on investing in quality companies that, for whatever reason, are undervalued by the general market. Deciding whether a company is undervalued is a process of looking at its fundamental financial indicators and deciding whether they are strong compared to its stock price
Analyzing and understanding companies is a major part of value investing. Investor look at potential companies and evaluate them based on their long-term plans, whether they have sound corporate values, its overall financial structure and by looking at the people that run the company. Value investing often involves buying companies that pay good dividends since this provides an additional return on the stock than waiting for its price to rise; it also indicates it is a mature and profitable enterprise.