Value stocks

One of the most common ways of classifying stocks is to distinguish between value stocks and growth stocks.

Value stocks are those of companies that operate in mature, usually defensive sectors and usually have high barriers to entry. Value stocks are much less volatile than growth stocks.

Electric utilities, food, or highway companies could be an example of companies comprised of value stocks. In general, companies comprised of value stocks tend to allocate their profits to dividend payouts.

They are usually perfect for investors who are quite risk-averse.