The primary objective of value funds when selecting investments is to identify and acquire securities that are perceived to be undervalued by the market. These funds follow the philosophy of "value investing," a strategy pioneered by legendary investor Benjamin Graham and further popularized by Warren Buffett.

Value funds seek out companies whose stocks are trading at prices lower than their intrinsic value, often due to temporary market fluctuations, negative sentiment, or overlooked fundamentals. The core belief behind this approach is that over time, the market will correct itself, reflecting the true worth of the underlying assets. Value fund managers meticulously analyze financial metrics such as price-to-earnings ratios, price-to-book ratios, and dividend yields to determine if a stock is priced lower than its inherent value.

By focusing on undervalued opportunities, value funds aim to achieve two main goals: capital appreciation and risk mitigation. The potential for significant price appreciation exists as the market eventually realizes the true value of the companies in question, leading to potential gains for investors. Additionally, the perceived margin of safety in buying undervalued assets can help reduce the downside risk, as the gap between the market price and intrinsic value acts as a protective buffer.

In summary, the primary objective of value funds is to uncover and invest in assets trading below their intrinsic value, leveraging this discrepancy for potential capital appreciation while minimizing the downside risk. This approach requires a keen eye for fundamental analysis and a long-term perspective on market trends.