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Investment style

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63: 165: 260: 22: 682: 445:(prices inhering all news, and hence potential) should favor active stock selection: for example, smaller companies are not followed as closely as larger blue-chip firms, and may then trade at a discount to true value. The 485:
effect: returns on growth stocks and value stocks are not highly correlated, thus by diversifying between growth and value, investors may reduce risk and still enjoy long-term return potential.
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as the basis for investing. Studies of stock returns going back to 1925 have suggested that "smaller is better," and on average, the highest returns have come from stocks with the lowest
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look for bargains — cheap stocks that are often out of favor, such as cyclical stocks that are at the low end of their
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and value seekers. Proponents of growth seek companies they expect (on average) to increase earnings by 15% to 25%.
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believe in their ability to outperform the overall market by picking stocks they believe may perform well.
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combines a passive style in an efficient market and an active style in less efficient markets.
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may produce potentially higher long-term results (pointing out that the majority of
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Financial risk management § Investment management
429:, on the other hand, feel that simply investing in a 87:. Unsourced material may be challenged and removed. 513:seeking a tradeoff between volatility and return. 505:". At the same time, small-cap stocks have higher 391:— and within each further weighs factors such as 730: 713: 469:. A value investor is primarily attracted by 191:introducing citations to additional sources 634: 632: 50:Learn how and when to remove these messages 720: 706: 367:. Here, for example, one manager favors 322:Learn how and when to remove this message 304:Learn how and when to remove this message 147:Learn how and when to remove this message 629: 457:: Active investors can be divided into 181:Relevant discussion may be found on the 473:with low prices compared to underlying 731: 375:. The classification extends across 603: 601: 599: 441:). Active investors feel that a less 355:), referring to how a characteristic 340:Investment strategy § Strategies 336:Style investing § Classification 676: 414:Major styles include the following: 253: 158: 85:adding citations to reliable sources 56: 15: 13: 688:This finance-related article is a 596: 14: 765: 31:This article has multiple issues. 680: 258: 174:relies largely or entirely on a 163: 61: 20: 481:. These two styles may offer a 72:needs additional citations for 39:or discuss these issues on the 647: 617: 579:Conservative Formula Investing 371:, while another prefers large 1: 608:Mutual Fund Investment Styles 589: 692:. You can help Knowledge by 534:Returns-based style analysis 7: 614:Learning Library (Archived) 517: 284:the claims made and adding 10: 770: 675: 493:: Some investors use the 333: 559:Low-volatility investing 401:diversification benefits 351:(and more generally, in 639:Investment Philosophies 574:Magic Formula investing 491:Small Cap vs. Large Cap 447:core-/satellite concept 749:Investment management 626:, nasdaq.com/glossary 624:Investment philosophy 499:market capitalization 471:asset-oriented stocks 389:financial derivatives 357:investment philosophy 349:investment management 334:Further information: 187:improve this article 81:improve this article 564:Momentum investing 479:liquidation values 477:, replacement, or 419:Active vs. Passive 359:is employed by an 269:possibly contains 202:"Investment style" 96:"Investment style" 701: 700: 569:Quality investing 501:, the so-called " 495:size of a company 431:market index fund 427:Passive investors 332: 331: 324: 314: 313: 306: 271:original research 252: 251: 237: 157: 156: 149: 131: 54: 761: 722: 715: 708: 684: 677: 670: 669: 667: 665: 651: 645: 643:Aswath Damodaran 636: 627: 621: 615: 605: 549:Growth investing 539:Asset allocation 507:price volatility 455:Growth vs. Value 443:efficient market 423:Active investors 409:growth prospects 373:blue-chip stocks 369:small cap stocks 345:Investment style 327: 320: 309: 302: 298: 295: 289: 286:inline citations 262: 261: 254: 247: 244: 238: 236: 195: 167: 159: 152: 145: 141: 138: 132: 130: 89: 65: 57: 46: 24: 23: 16: 769: 768: 764: 763: 762: 760: 759: 758: 729: 728: 727: 726: 674: 673: 663: 661: 653: 652: 648: 637: 630: 622: 618: 606: 597: 592: 554:Value investing 524:Style investing 520: 483:diversification 463:Value investors 347:, is a term in 342: 328: 317: 316: 315: 310: 299: 293: 290: 275: 263: 259: 248: 242: 239: 196: 194: 180: 168: 153: 142: 136: 133: 90: 88: 78: 66: 25: 21: 12: 11: 5: 767: 757: 756: 751: 746: 741: 725: 724: 717: 710: 702: 699: 698: 685: 672: 671: 646: 628: 616: 594: 593: 591: 588: 587: 586: 581: 576: 571: 566: 561: 556: 551: 546: 541: 536: 531: 526: 519: 516: 515: 514: 511:mid-cap stocks 487: 486: 467:business cycle 451: 450: 439:market indexes 405:relative value 330: 329: 312: 311: 266: 264: 257: 250: 249: 185:. 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Retrieved 659:Investopedia 658: 649: 619: 584:Buy and hold 503:Size premium 490: 454: 435:mutual funds 418: 413: 365:fund manager 356: 344: 343: 318: 300: 291: 268: 240: 230: 223: 216: 209: 197: 173: 143: 134: 124: 117: 110: 103: 91: 79:Please help 74:verification 71: 47: 40: 34: 33:Please help 30: 529:Style drift 744:Investment 733:Categories 664:29 January 590:References 278:improve it 213:newspapers 107:newspapers 36:improve it 294:July 2022 282:verifying 243:July 2022 183:talk page 137:July 2022 42:talk page 518:See also 397:momentum 393:leverage 381:equities 361:investor 353:finance 276:Please 227:scholar 121:scholar 459:growth 338:, and 229:  222:  215:  208:  200:  123:  116:  109:  102:  94:  385:bonds 234:JSTOR 220:books 128:JSTOR 114:books 690:stub 666:2019 475:book 206:news 100:news 612:AXA 407:or 387:or 363:or 280:by 189:by 83:by 735:: 657:. 641:, 631:^ 610:, 598:^ 421:: 411:. 403:, 399:, 395:, 383:, 379:— 45:. 721:e 714:t 707:v 696:. 668:. 325:) 319:( 307:) 301:( 296:) 292:( 274:. 245:) 241:( 231:· 224:· 217:· 210:· 193:. 179:. 150:) 144:( 139:) 135:( 125:· 118:· 111:· 104:· 77:. 52:) 48:(

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