Value investors are bargain hunters. They look for undervalued stocks. Stocks with prices they believe don't fully reflect the security's intrinsic value are sought after. Part of the basis of value investing is the belief that some degree of irrationality exists in the market. In theory, this irrationality offers opportunities to buy stocks at a discount and profit from them.

In order to find deals, value investors don't have to comb through volumes of financial data. Investors can own a basket of undervalued stocks through thousands of value mutual funds. The Russell 1000 Value Index, for example, is a popular benchmark for value investors and several mutual funds mimic this index.