A lot of opinions have been thrown regarding the benefit of value investing versus growth investing style proponents of each style of investing insist that their method is superior over the other. I believe that each has its merit. Being a proponent of value investing. Here are the differences between value and growth.
1. Value investing
First, value investors buy companies in a mature industry. That said, it is easier to predict the earnings of such companies. This is why I lean toward value investing. I am in favor of reducing risk instead of chasing return. Anybody can estimate that a small biotech company A will rake in X amount of profit after several years. But, if your prediction is not accurate, then how do you determine the fair value of the common stock? Your valuation will be out of whack. The disease comes and goes.