Everyone loves a good discount. Whether it’s on your car insurance or a meal at your local burger joint, any time you can snag a bargain it’s well worth it. It’s even better when you can grab a stock with a juicy yield at a discounted price. This is the essence of value investing.
However, sometimes what seems like a diamond in the rough can end up as a stinky kettle of fish.
There’s a fine line between spotting a stock trading below its intrinsic value and one that is a bear trap waiting to happen. For investors, knowing how to pick the real value can mean the difference between having a nice total return and dealing with dead money.
For more investment concepts, visit our Dividend Investing Ideas Center.