How Bear Markets Can Be Like Black Friday for Value Investors
For many people, Black Friday marks the start of the holiday shopping season. Most retailers cut their prices, store traffic increases, and online shopping carts fill up with lightning speed. Although you won't see people racing through stores to buy stocks, bear markets like the one we're currently in can serve as a Black Friday for value investors.
Stocks generally have two values: the actual price the stock is trading at and the intrinsic value. Market value will tell you how much people are willing to pay for a stock, while intrinsic value is based on calculations using various financial models and metrics. As a value investor, the goal is to buy stocks whose market price is below their "real" value. It's not always the easiest thing to do, but it's usually much easier in bear markets when share prices are falling.
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Source Fool.com
