Value stocks have long been a cornerstone of successful investing strategies. In the realm of equity investments, these stocks offer unique characteristics that set them apart from other categories, such as growth or dividend stocks. Understanding the role of value stocks in a well-diversified portfolio is essential for investors seeking to harness their potential and achieve long-term financial goals. In this article, we explore what value stocks are, their role in a portfolio, and how they differ from other types of stocks. What are Value Stocks? Value stocks represent shares of companies that are currently undervalued relative to their intrinsic worth or “intrinsic value.” Intrinsic value is often determined through various fundamental analysis methods, such as examining earnings, book value, and cash flow. Investors who believe in the underlying strength of these companies view value stocks as potential bargains in the market. The Role of Value Stocks in a Portfolio 1. Capital Appreciation The primary goal of including value stocks in a portfolio is to capitalize on their potential for significant capital appreciation. As market sentiment shifts or company-specific factors improve, undervalued stocks have the