It’s the same feeling for certain investors this year; those plugged into the value argument who have seen their portfolios dip as growth stocks have again roared back into favour.
Admittedly, it could be a short-term trend, but equity commentators vocal about the value renaissance have been left red faced by subsequent performance differential so far in 2017.
So far this year (to 10 February), FTSE World Growth has delivered 4% compared to 1% from FTSE World Value. It’s a similar story from other indices.
As Lyxor’s latest Cross Asset Research report would have it, value stocks “lost steam” in the early part of this year as market exuberance has faded and investors have reappraised the risks of trade wars.
“The renewed underperformance of value stocks has taken many investors by surprise as it follows a sharp rebound in the last quarter of 2016,” the analysts state.
“The January reversal has been particularly abrupt in the US, where the MSCI USA Value underperformed the market by 2% and the MSCI USA Growth by 4%.”
