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Style Box Update, Scary Stats, Top 10 Holdings As Of 3/31/21

Brian Gilmartin, CFA profile picture
Brian Gilmartin, CFA


  • Value has underperformed Growth since 2016.
  • Does the value outperformance continue?
  • Be sure and own some value and non-momentum in your portfolios, even though large-cap growth may not be as out-of-favor as happened between 2000 and 2007.

Source: internal spreadsheet updated every 6 weeks or 2x a quarter.

Value has underperformed Growth since 2016 as readers can see from the above spreadsheet, which was a duration similar to the late 1990s in terms of length.

However, that started to change in the 4th quarter of last year, and you can see the sharp outperformance by "value" across all market caps in q1 '21.

The key question is - "Does the value outperformance continue?"

Not shown in the above ETF detail is the Russell 1000 Growth vs Russell 1000 Value for Q1 '21:

This chart from YCharts shows the dramatic outperformance of Value in q1 '21, within the Russell 1000, a tech-heavy index, where Tech has a 40% weight.

Financials is a sector that will likely continue to work higher, although higher rates and a steeper yield curve clearly help.

This clear breakout on the XLF is a 13-year consolidation at an end. The KRE or regional bank ETF (chart not shown) actually hit a new all-time high in 2018 and is testing the $65 - $66 level again. Energy and Basic Materials should probably be folded into one sector given their respective market-cap weights.

Similar to what happened in 2000 - 2003, value has quickly become momentum, while momentum - like large-cap tech - is starting to look "value-like" on a relative PE and cash-flow basis.

Scary stats (or data of which I take notice):

  • Cumulative 2-yr total return of the SP 500 from 01/01/2019 to 12/31/20: +55%
  • Cumulative 2-yr total return of the Nasdaq 100 from 1/1/2019 to 12/31/20: +107.6%

Is it any wonder that large-cap Tech, growth, and /or momentum need a break?

1 and 3-yr returns SPY versus EM ETFs:

Look at the one-year returns versus the pandemic lows (almost) for the SPY versus some

This article was written by

Brian Gilmartin, CFA profile picture
Brian Gilmartin, is a portfolio manager at Trinity Asset Management, a firm he founded in May, 1995, catering to individual investors and institutions that werent getting the attention and service deserved, from larger firms. Brian started in the business as a fixed-income / credit analyst, with a Chicago broker-dealer, and then worked at Stein Roe & Farnham in Chicago, from 1992 - 1995, before striking out on his own and managing equity and balanced accounts for clients. Brian has a BSBA (Finance) from Xavier University, Cincinnati, Ohio, (1982) and an MBA (Finance) from Loyola University, Chicago, January, 1985. The CFA was awarded in 1994. Brian has been fortunate enough to write for the TheStreet.com from 2000 to 2012, and then the WallStreet AllStars from August 2011, to Spring, 2012. Brian also wrote for Minyanville.com, and has been quoted in numerous publications including the Wall Street Journal.

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Comments (4)

SuperPac profile picture
Entities like HON and MMM are revving up too. I had almost given up on MMM.
I had given up on Mattel. That's nicely up and may head to a bright spot after all.
I agree with you on Coinbase.
What do you think about indirectly owning crypto via investing in entities like MSTR?
Thanks Brian.
Brian Gilmartin, CFA profile picture
@SuperPac Never looked at MSTR SP. will do. The thing about pure crypto is that it has different tax treatment whereas the coinbase common equity will be like owning another common stock. Like the Indistrial / cyclical trade.
Thank you for your insights. It was very helpful.
Thank you for sharing!
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