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Definition of 'Value Trap'
A stock that has experienced a large price depreciation and is mistaken to be a value stock.
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Investopedia explains 'Value Trap'
When a company's stock seems undervalued, investors are sometimes drawn into purchasing it in hopes of a stock price appreciation. If stock price is the only factor an investor looks at before buying a stock, he or she could end up with a stock whose value is likely to decline even further.
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Find out how to avoid getting sucked in by a deceiving bargain stock.
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Buying value stocks that are moving higher helps investors steer clear of value traps.
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This simple measure can help investors determine whether a stock is a good deal.
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Take a look at how this effective ratio can be influenced by certain critical factors.
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We look at the Sage of Omaha's methodology for evaluating value stocks.
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There are many ways to make money, knowing how to choose the best stocks is one of them.
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Discover the key elements of a good long-term investment and how to find them.
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