As I read online investing sites like MarketWatch, Bloomberg, and Fool.com, along with the various shows on CNBC, I’m often intrigued at the number of so-called “expert” investors who like to ignore the basic rules of value investing. Sure, they justify their actions by saying their growth investors, not value investors, but does that really allow them to make some downright stupid choices?

My main problem with growth investing is that it is inherently speculative. A large part of being a growth investor is “being able to see the future.” In other words, there’s a lot of guessing. Think of a monkey picking a random company on a long list.

In my opinion, any wise investor will choose to be a value investor. The returns can still be fantastic, but the risk is significantly lower than the risk assumed by the growth investor. Value investing is all about finding companies that are undervalued based on their assets compared to their market price.

If a company has $1 billion in assets and a market value of $500 million, the value investor will recognize that there is very little risk in buying that company. Growth investors, on the other hand, will see a company with $10 million in assets and a market value of $1 billion and try to make up scenarios where that company will be able to grow so fast that it will have significantly more than $1 billion in a few years. Growth investors created the dot-com bubble and its burst by speculating that companies like Pets.com would dominate  a market for pet supplies that they hoped would grow to tens of billions of dollars. Where was all this money going to come from to create a huge market for such things? The growth investor need not think rationally.

This site is a haven for those sensible people we call value investors. I will preach the principles of Benjamin Graham, who shook the investing world with his books, including Security Analysis, The Intelligent Investor, and The Interpretation of Financial Statements. I’ll also bring in some ideas from investors who have used his method, including Warren Buffett. If you want tips on what’s “gonna be hot” next month, go watch Jim Cramer or Fast Money (although those shows can sometimes be useful to all investors, you have to know when to ignore them). If you use sound reasoning to make sound investments, you will have no reason to apologize later for making a stupid pick.