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Why Value Investing is the best approach to amass wealth

Van Den Berg’s 8 tips for wealth creation and investment success


Feb 10, 2024, 04:11:20 PM IST1/12

Why Value Investing is the best approach to amass wealth

Super-investor Arnold Van Den Berg says value investing is the best approach to amass wealth in the long term, as it is not very popular with the masses and provides opportunities for investors to buy stocks at good bargains.



Capitalise on value gaps

Van Den Berg says the main focus of investors should be to recognise and capitalise on value gaps. Simply put, a value gap is the difference between the price of a stock and the underlying value of the business.



Never predict the market

Van Den Berg also warns investors against predicting or timing the market and advises them to keep their focus on buying businesses at attractive prices.



Investment Tips

The legendary investor also listed out some lessons that he has learnt during his investment journey:-

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Reading helps make better investments

Investors need to read about as many businesses as they can and make sure to stay up to date on the ones that interest them from an investing standpoint. As investors read more and more about different businesses, they start getting a good sense of which industries have attractive business models and which ones have lousy business models and that can help them make better investment decisions.



Self-discipline is a key contributor to success

Self-discipline is a key factor that contributes to an investor’s success in life and investing. The most self-disciplined human beings are more likely to achieve their goals than others. Discipline in investing means always thinking about the worst-case scenario as well as disciplined buying and selling and margin of safety.

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Be careful of leveraged businesses

He says the number one lesson he has learnt during his entire investing career was to be very cautious while investing in leveraged businesses, which often result in the most capital losses.



Follow good principles

It is essential for investors to follow good principles and morals in life as it makes them better equipped to take crucial business decisions.


Take the right decision

There are times when investors have to make tough decisions, which may not necessarily be good for them but it may be the right thing to do. Van Den Berg encourages investors to trust their instincts and make the right decision as things never go wrong when correct decisions are taken.



Stay focused

In order to become a successful investor, it is important for an individual to be focused on the task. As the market is generally volatile in the short term, investors can face a lot of ups and downs in their investment journey and it is only absolute focus and resolve that can make their minds incredibly powerful to deal with extreme circumstances.



Study the subconscious mind

To achieve this extreme level of focus, it is essential to do extensive study of the subconscious mind, which is the key to unlocking an individual’s potential.



How to achieve true prosperity

To achieve true prosperity and inner happiness, it is important to have a life that has a sense of equanimity and control over circumstances. “If I had no money at all, I would still have abundance because I have a mindset of abundance and I feel that prosperity,” he says.



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