There are many definitions as to what value investing is, it is the kind of question that you will get different answers depending on who you ask.
Generally, there are 2 kinds of value investing.
Asset-based: invest in companies selling below their net asset priceIncome-based: invest in companies selling below their earnings potentialThe kind that I stopped doing, is asset-based value investing.
Case Study with Properties:
You deal with buying and selling of properties.
There was a house that you were previously considering buying but did not do so because it was selling at $500k, which you think is not cheap enough.
However, due to a recession in the economy, the owner is now willing to sell the property for $400k if you are willing to sign the deal within 1 week.
This presents you with the opportunity to buy the house for $400k, then take your time and wait for the economy to recover, then find...