Explain the key distinctions between 'value investing' and 'growth investing', and how each approach might perform differently in various economic cycles.

Value investing focuses on identifying companies that are trading below their intrinsic value, meaning their market price is lower than what a thorough analysis suggests they are actually worth. Value investors look for stocks with low price-to-earnings ratios, low price-to-book ratios, and high dividend yields, indicating that the market may be undervaluing the company's assets or earnings potential. The strategy aims to profit when the market recognizes the company's true value and the stock price rises. Growth investing, conversely, focuses on companies that are expected to grow their earnings at a faster rate than the overall market, regardless of their current valuation. Growth investors look for companies with innovative products, strong competitive advantages, and a large addressable market, even if their current earnings are low or negative. They are willing to pay a premium for these stocks, anticipating that future earnings growth will justify the high valuation. In terms of economic cycles, value investing often performs well during periods of economic uncertainty or recession, when investors become more risk-averse and seek out undervalued, stable companies. Growth investing tends to outperform during periods of economic expansion, when investors are more willing to take risks and invest in companies with high growth potential. However, these are generalizations, and the relative performance of value and growth stocks can vary depending on specific market conditions and investor sentiment. Each strategy has its own risks; value stocks can remain undervalued for extended periods, while growth stocks can be highly volatile and sensitive to changes in growth expectations.