Bargain or value trap?

Summary: In 2011, Wealth Insight printed four stock screens built on four different philosophies, then never touched them again. Fifteen years later, the results are in. A look at what actually beat the market and why, in a growing economy, the cheapest stock is rarely the one that wins.

Summary: In 2011, Wealth Insight printed four stock screens built on four different philosophies, then never touched them again. Fifteen years later, the results are in. A look at what actually beat the market and why, in a growing economy, the cheapest stock is rarely the one that wins. The other day, a younger colleague stopped at my desk, excited about a bank trading well below its book value, a rupee of assets going for 50 paise. He wondered whether it was the sort of stock we should be looking at for Value Research Stock Advisor. “Why wouldn’t you buy it? he asked. We talked for an hour. He had Benjamin Graham on his side: buy assets cheaply and wait for the discount to close. But deep value, buying the statistically cheap and waiting, works best in mature, slow-growing markets, where a cheap stock is often just a mispriced one. In a fast-growing economy like ours, the bigger prize goes to the company that is growing, as long as you do not overpay for it. Not the cheapest stock. The growing one, at a fair price. It is an old debate, and conviction alone could not settle it. So, we let the data do the talking. A 15-year-old experiment, still running Turns out we had already run the test, years ago, without knowing it. Back in September 2011, when I had a hand in building these screens for the magazine’s early issues, Wealth Insight printed four lists of stocks we called ‘Stock Ideas’. Each rested on a different, time-tested philosophy: growth at a reasonable price, blue-chip quality, discount to book value and high dividend yield. Four screens, 79 companies, one date. The Sensex hovered near 16,000 and the mood was anxious. We n

This article was originally published on July 01, 2026.