There are many ways to search for deep value opportunities in the financial market. Some wait for financial events that affects several companies temporarily. Often, such cases may surface stocks with depressed prices far below their intrinsic value.
However, there is little certainty if you’d wait for such random sporadic events. Years may go by and opportunities may not even arise.
There is nothing wrong with looking out for such situations. However, to make the searching process more intelligent, we start by asking a few questions.
When do these opportunities usually arise? What should you be looking out for? How certain are you that it is only temporary, in other words, it does not affect its intrinsic value?
If you have a look at market history in the big picture, there are clear cyclical trends attached to most industries. Is this purely by chance or is there any fundamental reason behind?