Russell 1000 growth index past 12 month is up 22%
Russell 1000 value index past 12 month is up 5%
When have we had a disparity this big before? 1999?
I think this is sensitive to the factors used, and the determining factors for R1000 value is P/Bk and lack of growth. Also the R1000 value is currently 23% financial sector which I think needs to be evaluated separately from value factors of other sectors. There are suites of value factors that will perform better from what is included here, but P/Bk is not one I use.
From the ishares documentation:
“The Underlying Index measures the performance of equity securities of Russell 1000 Index issuers with lower price-to-book ratios and lower
forecasted growth relative to all securities included in the Russell 1000 Index. As of March 31, 2017, a significant portion of the Underlying
Index is represented by securities of financials companies”
“Russell 1000 growth index past 12 month is up 22%
Russell 1000 value index past 12 month is up 5%”
How do we chart this differential in P123? On one chart and over time? Anyone know?
growth stocks are humiliating value stocks
Don’t invest in value stocks in growth market and vice versa.
my 2 cents over 5 years of studying fundamentals from AAII retirees who treat 90% of investment books having garbage information.
when market keep going high and high day after day after regaining 52 week high point from Dec 2016 to Jan 2018, it is a growth market;
need to buy FANG stocks. FB, AMAZON, NETFLIX, GOOGLE made 50% to 100% returns during 12 to 15 months period. All these 4 stocks are high growth stocks.
MA, BAC are also doubled.
BRK/B is Warran Buffet’s value holding company is down for last 5 months around 15%, it is leading indicator of market is in trouble. and leading stock for value market.
Curent status of the market:
XLU and XLP are trending up, look like it is defensive market at the moment. both value and growth works in side ways for last 3 months and will continue for some more time.
a portion of investment in TLT, XLU and XLP will smooth out volatility in portfolio till end of Aug 2018.
Thanks
Kumar
Try setting up an erf screen with one ticker based rule, say for the growth etf. then, for benchmark, use the value etf.
You can also abuse the Custom Series tool; see https://www.portfolio123.com/app/series/summary/8737?st=1&mt=8
If you find that helpful, make a copy since I will delete the series in a few days.
Walter
The question is: is it too late to start buying growth stocks now?
http://stockcharts.com/articles/journal/2018/03/charts-im-stalking-action-practice-25.html
The author is MBA from Standford 1981, and CMT president of TSSA 1998.
more than all full-time investor for last 30 years with expertise in fundamental analysis and technical analysis, making living by investing not by selling classes or books.
vanguard john boggle core portion of the assets allocation. instead of guessing where to put money. always invest with diversification.
Hardvard university and Columbia university business school uses similar portfolio all weather to earn 10% to 15% every year to manage their funds to grow for university endowment.
expecting feed back from Mgerstein and other long term successful investor about this article.
all weather portfolio allocation.
Here, i am sharing this article to get some more knowledge from p123 experts.
Thank you
Kumar
Has anyone devised a system for high growth (25%+) stocks with negative earnings currently?
To me, value and growth are two sides of the same coin. Growth is a component of fair value, just as earnings or time value. The barriers that are often drawn between growth and value are artificial.
A system for pricing assets which is agnostic to negative earnings or astronomical growth rates is – in my opinion – robust since all things are held to the same standard.
Highfalutin ideals aside, I think that this should be possible by estimating the NPV (DCF) for an asset in which revenues are growing faster than costs. But you can’t just assume that growth goes on into perpetuity (or else the fair value would be infinite), so you’ve got to define time frames and/or time varying growth rates. Also, you have to define what you mean by growth (e.g, Earnings? Revenue? Assets? Equity? Prices?).
This model only considers 5-year composite growth in sales. Earnings, cash flow, and other fundamentals are not used in the system.
https://www.portfolio123.com/app/r2g/summary?id=1439560
“Value is in the eye of the beholder.” Some managers/investors value companies based on industry size/market share. (Think Uber, Tesla, Amazon, Netflix, etc.) Once the industry matures and growth subsides then the business model can be morphed to generate profits. A good example of this would be Uber which will likely never be profitable with its current business model. However, with autonomous vehicles it may be another story. The point is that Uber will be the company best able to capitalize on such technology due to their market position. I’m not sure how one can analyze such high growth companies based on DCF or DDM. At the best of times, DCM is very sensitive to input variables (assumptions).
If you have more money invest in top performing fund and etf poagx and ffty both are based on earnings and growth style run by world class investors in growth space, the money managers experience comparable to younger days warran buffet 20% to 30% returns are expected in good years.
Alternatively you can buy combination of dm model to manage your own. Designing models with liquid stocks will take few years to work in out of sample if you don’t have already successful manual stock picking methods using fundamental.
With god grace, my designer model is reviewed by Mgerstein who has 3 decades of investment experience and have attended work shops by Hardvard and Stanford mba with decades of investing experience.
One thing is common wisdom shared by all these 3 experts described above, Don’t know what will happened next week, next month and next years. But they are 100% sure they will gain more than they will loose in next 5 years to 10 years time frame. That make them happy about the market for they ar accepting small draw down for longer term gain.
Everyone in the world want to make money fast, but the accomplished successful investor want to make money consistently and slowly. They never short the market, stay away from option, future, forex and inverse etf.
If they don’t like something, they won’t argue, just they will ignore it and keep move-on. Very positive attitude, same stock market, their lenses make them happy to play the same game. I am working towards improve my investment and practice more patience to keep cool follow the trading plan with discipline.
Thanks
Kumar
Thank you
Kumar 
S&P500-10Value Stocks-Rev2-FREE
https://www.portfolio123.com/app/r2g/summary?id=1439307
Thanks
Kumar