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More glossary terms
- JOLTS (job openings and labor turnover survey)
- Earnings per share (EPS)
- Nasdaq composite
- Unit
- Value investing
Value investing definition
Value investing is an investment strategy where you look for shares that seem to be underpriced – basically, bargains in the stock market.
What is value investing?
Value investing is an investment strategy where you look for stocks that seem to be underpriced – basically, bargains in the stock market. The idea is to buy companies that are solid but currently unloved by the market, then hold onto them until their true value is recognised.
Value investors tend to focus on things like:
- Low share prices compared to earnings or assets
- Strong fundamentals (e.g. steady profits, good management)
- Long-term potential, even if short-term performance isn’t great
It’s a bit like buying a quality winter coat in the summer sales – you’re looking past the current hype (or lack of it) and focusing on what something is really worth.
One of the most famous value investors? Warren Buffett.
Investing glossary
It's important you know
Capital at risk. All investing should be for the longer term. The value of your investments can go up and down, and you may get back less than you invest. Tax treatment depends on individual circumstances and may be subject to change in the future.
A 25% government penalty applies if you withdraw money from a Lifetime ISA for any reason other than buying your first home (up to £450,000) or for retirement, and you may get back less than you paid into your Lifetime ISA.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Payments you make into your pension won’t be accessible until the minimum pension age (currently 55, increasing to age 57 from 2028). Tax treatment depends on individual circumstances and may be subject to change in the future.