Value premium
Hello kiddo, value premium is a fancy term that grown-ups use to talk about how some things can be worth more even if they don't look as cool or shiny as other things.
You know how when you go to a store, some toys or candies cost more than others? Well, that's because people think that those toys or candies are better or cooler than the other ones. This is like how some stocks are more popular and people want to buy them, so their prices go up.
But sometimes, there are other things that might not look as exciting or popular, like vegetables or school books. Even though some people might not want them as much, they are still very important and can be very useful. This is like how some stocks might not be as popular, but they can still be a good investment because they are worth more than people think they are.
So, some people like to invest in these kinds of stocks because they think they are good value for their money. They hope that eventually, other people will realize that these stocks are worth more than they thought and their prices will go up. This is called value premium investing.
So, just like you should always eat your veggies and do your schoolwork, grown-ups should remember that sometimes the things that look boring or unpopular can still be very valuable!
You know how when you go to a store, some toys or candies cost more than others? Well, that's because people think that those toys or candies are better or cooler than the other ones. This is like how some stocks are more popular and people want to buy them, so their prices go up.
But sometimes, there are other things that might not look as exciting or popular, like vegetables or school books. Even though some people might not want them as much, they are still very important and can be very useful. This is like how some stocks might not be as popular, but they can still be a good investment because they are worth more than people think they are.
So, some people like to invest in these kinds of stocks because they think they are good value for their money. They hope that eventually, other people will realize that these stocks are worth more than they thought and their prices will go up. This is called value premium investing.
So, just like you should always eat your veggies and do your schoolwork, grown-ups should remember that sometimes the things that look boring or unpopular can still be very valuable!