Are Value Stocks Poised for Growth?

Value investing has fallen on tough times, and is “getting tiresome even for those famous for their patience,” according to a recent Barron’s article. On the face of it, value investing should work, the article argues. “At its most basic, it’s buying stocks that are cheap and holding them until the rest of the market realizes these great companies are selling at a bargain price, and pile in, driving prices up.” But since 2006, it… Read More

Growth Vs. Value Index Debate Has Ended

The evolutionary shift from active to passive investing has ended the feud between growth and value investors, according to a recent Bloomberg article which argues that “growth and value are now broken approaches that have the potential to create significant and unnecessary risk for many investors.” The article explains that growth and value investing “came of age during the mutual fund-driven rise of active management in the 1980s and 1990s” but cites the following issues… Read More

Growth Stocks May be Outperforming, But Value Will Come Back

Since the financial crisis, growth stocks have beaten value but, over the long-term, value will have its day in the sun. This according to a recent article in the Financial Post. “Over the long term, buying value and ignoring the shiny, well-liked stocks has paid off,” the article says, but the reversal in performance over the last decade has seen return-hungry investors gravitating toward dividend-payers and tech stocks and the “cheaper” parts of the market… Read More

Picking Stocks is Hard, But Picking Growth Might Be Harder

In a recent article for Bloomberg, columnist Nir Kaissar discusses the ongoing debate regarding the challenge of stock picking. He cites a study conducted by University of Arizona professor Hendrick Bessembinder that found, for the period between 1926 and 2016, “only 4 percent of stocks accounted for all the wealth created,” and “50 of those stocks accounted for 40 percent of that wealth.” That basket of 50, writes Kaissar, resembled a growth stock portfolio (and… Read More

Growth or Value: Who’s Driving the Bus?

Conventional wisdom suggests that value reigns at the beginning of bull markets and growth overtakes as the bull market progresses. But there is data that suggests another relationship: That is, that financials and tech play a dominant role in the respective strength of growth and value, this according to research by Standard & Poor’s Managing Director of US Equity Strategy, Sam Stovall. The correlation of monthly percentage changes in both the growth/value and tech/financials relative… Read More