The Cost Approach is an investment methodology designed to provide insight into the value of a given asset or project. Through this approach, investors seek to estimate the cost of replacing an existing asset with one of similar utility. The cost approach is based on the belief that market fluctuations in the asset’s eventual price will not be as severe as those experienced by similar items in the past; thus, enabling the investor to enter into more advantageous financial positions. By using this method, investors can make informed decisions about their investments and maximize their profitability.