GreenAB

What's Wrong with Today's Value Investing?

i consider myself a value investor too.
but i guess we´re in a process of transforming valuations.
models rely on todays prices in relation to lets say the last 10-15 years.
but thats too shortsighted.
the market prices dire profits for the coming years.
that makes stocks less attractive.
so if a model would suggest that a pe of 10 is cheap, there´s no law it has to stay that way. it can fall to 7, 5 or 2 - nobody knows.
it´s called pe-contraction and it happende way in the past.
not an easy time for stockpickers...