In the equity market, investments always need to be prudently hedged, in order to overcome uncertainties and limit losses related to external shocks. A question that arises often is whether one should resort to a value strategy that seeks discounted stocks or opt for growth investing, in times of extreme market instability.
The investing track of the Oracle of Omaha over the past few decades and his gradual shift from being a pure-play value investor to a GARP (growth at a reasonable price) investor might give us all the answers.
Under the GARP theory, the strategic mingling of growth and value-investing principles gives us a hybrid strategy offering an ideal investment by utilizing the best features of both. What GARPers look for is whether