Growth Vs. Value
Box Jumpers Beware!
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Style rotation! Regime change! Market action of the first two weeks of September coaxed the few remaining Small Cap Value managers off ledges from New York to San Francisco.
1999 Redux
As the market rebound has extended, we’ve noted its striking similarities with the rally of 1999—one that might have been the most speculative in U.S. history.
Partying Like It’s 1998-99
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We thought Jerome Powell’s “Christmas Capitulation” would be tough to beat, but he accomplished that two days ago with what could be called his “Spring Surrender.” That, in turn, has rekindled hopes of a stock market melt-up along the lines of 1998-99, which, as old-timers will remember, followed a late-cycle correction that was nearly identical to the one seen last year.
Try This On For Size
Today’s market is barbelled regarding company size, with the mega-cap Tech stocks and the S&P 600 Small Cap index both outperforming the middle of the S&P 500.
Value Style’s 100-Year Flood
Value is the philosophical cornerstone of many legendary portfolio managers and is widely recognized as one of the most robust quantitative investment factors. Yet, despite its compelling conceptual merits and long-term record of superior returns, recent years’ underperformance of Value has lasted long enough to weigh on even 10-year performance records.
Growth: Too Much of a Good Thing?
Growth has trounced Value over the past year, continuing a decade-long trend of outperformance...
Valuation-Based Country Selection/Rotation
Despite cyclicality, over the longer term, investing in lower valuation countries ekes out better performance in an EM portfolio, and Dividend Yield showed the most consistency in terms of value factor effectiveness.
Dynamic Factor Investing: A Study In Value
Investment factors experience performance cycles just like every other asset and index. The Value factor is robust across definitions, as all eight versions produced positive excess returns under long/short and long-only methodologies.
Same Ponds, Different Fish?
The impact of atypically-high current valuations has become a challenge for style-box investing. High quality, mature dividend payers have habitually resided in the Value and Blend boxes, but investors have bid up those valuations as they look for alternatives to low bond yields.
Growth vs Value vs Cyclicals
Signs of a leadership change are starting to spring up between Growth and Value. Since mid-2015, Mid and Small Cap Value stocks have outperformed Growth.
Growth vs Value vs Cyclicals
Small Cap Growth stocks have gotten off to a rotten start in 2016—down almost 12%. On a relative basis, the segment has also been lagging Small Cap Value—underperforming by 9% since last July.
Navigating The First Rate Hike
Our current view is the lift-off will be December or later. Assuming inflation will pick up and the Fed hikes the rate by the end of 2015, stocks will perform relatively well, with international stocks a better bet than U.S. stocks.
Mythbusters: Style Performance During Bear Markets
Will Rogers said, “It isn’t what we don’t know that gives us trouble, but what we know that ain’t so.”
Why We Are Buying Big Cap Growth Stocks Now
Big cap growth stocks appear to be in the early stages of regaining leadership from the “tired” cyclicals and “overvalued” value stocks.
In Search of Blue Chip Growth Stocks
Growth stocks have been out of favor over the past 3-4 year, but look poised to regain leadership over the next 6-12 months.
Did Your Stocks Make Money In April?
A glance at the popular market averages made April look like a pretty good month in the stock market. But if your equity performance in April matched those numbers, you must have had a well-oiled portfolio of deep cyclicals.
August Insights
Secondary stocks’ August performance, growth vs. cyclical and growth vs. value performance, S&P and DIJA historical valuations and the Royal Blue Index.
Adding To “Undervalued & Unloved” Stocks
This month we added three new stocks from Jim Floyd’s “Undervalued & Unloved” screening work, boosting our current commitment to value stocks to 16% of portfolio assets. We now believe Value's downtrend has reversed and this view seems to be confirmed by the relative strength line.
View from the North Country
Are Value Managers an Endangered Species? Some observations and analysis. Also, a critical look at the S&P Mid Cap Index and have you ever been in Voice Mail Jail?
Prospects: Gilt Edged Growth, Cyclicals and Value Stocks
If you have major positions in the select list of 1990 “Hero” stocks (those big growth names that are up on the year), when should you start trimming back (if ever)? When should you start looking at cyclicals (if ever)? When should you start looking at cheap value stocks (if ever)?
Growth Versus Value Stocks
This month, we are featuring a chart appearing regularly in Jim Floyd’s Quantitative Themes quarterly publication. About 20% of The Leuthold Group’s clients are subscribers to QT, but we thought the other 80% might find this study of interest.
Is It Nifty Fifty Time?
Quality Growth stocks led the market in November and are now also outperforming the market year to date. Now that we have so many value players, is the stage set for an extended period of big growth stock leadership?