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Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Value Investing


Value investing is associated with conservative" investing but in practice, that's not always how things pan out. Is it better to own a company trading at a low price to earnings ratio that is dying (would you want to own a bookshelf producing company today at any price?)? Or is it better to pay a high multiple for Facebook? Value investors generally believe that the company's shares will grow either because they will grow earnings and keep their low multiple - or they will be perceived as having better growth prospects and achieve higher multiples."