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Global Multi-Asset Viewpoint
septembre 30, 2019
Value Stocks - Once In A Decade Opportunity
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Global Multi-Asset Viewpoint

Value Stocks - Once In A Decade Opportunity

Value Stocks - Once In A Decade Opportunity

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septembre 30, 2019


After 12 years of nearly unprecedented underperformance and one of the worst individual months in history (August), value stocks experienced a massive reversal relative to growth and momentum stocks in September 2019. As a result of what looked like interminable dismal performance of value stocks, many investors and pundits appear to have converged to the view that one ought to only own stocks which have exhibited either strong or steady earnings growth. In other words, own growth or quality but stay away from value.

Epitomizing this new conventional wisdom is a recently-published academic paper titled “Explaining the Demise of Value Investing.”1 After positing that value has underperformed not only for the last 12 years, but rather for almost 30 years (using a simplistic definition of value), they explain that economic fundamentals keep ”glamour stocks”—as they describe growth stocks—“at the top of their industries for decades… [as] creative destruction seems to have little effect on [them].” They finish by knocking down four potential drivers of “resurrection” for value and concluding with “what’s the likelihood of this to happen, and are there many investors who wish this to happen? We doubt it.” We beg to differ.

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1 Lev, Baruch; Srivastava, Anup. “Explaining the Demise of Value Investing” (August 25, 2019). SSRN: or http://

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