Value investing is the practice of buying shares that appear to trade below their true worth, then holding them until the market recognizes that value. The basics come down to three steps: estimate what a business is genuinely worth, compare that estimate to its market price, and buy only when there is a meaningful gap in your favor. This course teaches those fundamentals directly, covering how to measure total shareholder return and how to estimate intrinsic value using techniques such as the dividend valuation model and discounted cash flow.

Value investing works by separating a company's price from its value. A value investor estimates a firm's intrinsic worth through financial analysis, then buys when the share price sits below that estimate, leaving a cushion known as the margin of safety. This course walks you through each valuation method, including price-to-earnings and EBITDA multiples, net asset valuation, and market-to-book ratios, so you can judge whether a stock is genuinely undervalued rather than simply cheap.

Definitions vary, but investors are commonly grouped by risk appetite into four types: conservative (focused on protecting capital), moderate (balancing growth and safety), aggressive (accepting higher risk for higher potential returns), and speculative (pursuing large short-term gains). Value investing generally sits toward the conservative-to-moderate end, since the approach is built on risk control and patience, themes this course addresses through diversification and the margin of safety.