Value stocks have been faring quite well recently.  But in his “Intelligent Investor” column for The Wall Street Journal, Jason Zweig says that the key to value investing is how you respond when times get tough.

Zweig talks with value investing legend Jean-Marie Eveillard, who says that “most people aren’t cut out for value investing because human nature shrinks from pain.” And there’s plenty of pain in value investing — even for the greats. Zweig cites a study performed by Summit Street Capital Management that looked at a group of value investors with long records of excellent returns. The study found that even the best value investors underperformed the broader market one-third to 40% of the time.

“To be a value investor, it isn’t enough to buy cheap stocks or the funds that own them. You have to stick around until the market recognizes their worth,” Zweig writes. “As Mr. Eveillard warns, the long-term rewards don’t go to people who think value investing is easy. Superior returns can be earned only by those who know that it is hard — and stay put.”

Zweig talks about how most investors bail when times get tough, leading them to underperform the broader market. He also offers a couple notes of caution, saying that just because value stocks have outperformed over the past 85 years or so doesn’t mean they’ll put up the same numbers going forward. He says that value stocks are currently a bit pricier than they’ve been historically, and notes that while most value managers use the price/earnings ratio to identify value plays, the data showing that value stocks have outperformed since 1926 uses the price/book ratio.

As for Eveillard, he says two areas he’s currently finding value in are Japanese stocks and gold miners.