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Style And Asset Class Rotation Is Taking Place


  • As it relates to value versus growth performance one question becomes is this rotation to value and its outperformance sustainable and the start of a longer-term trend.
  • We do believe the economy has exited the recession and is in a part of the business cycle where value has historically outperformed growth.
  • Interest rate pressure to the upside is wanting to take hold as the inflation discussion increasingly makes headlines.

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For nearly three trading weeks, the S&P 500 Index has traded mostly sideways, somewhat expected after the fast start to 2021, i.e., the S&P 500 Index up over 11% through the end of April. Under the surface though the

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HORAN Capital Advisors is an SEC registered investment advisor that manages investment portfolios for individuals and institutions. Our firm utilizes a disciplined investing approach that should create wealth for our clients over time. Our investment bias is to invest in companies that generate a steady return over time, i.e., singles and doubles. This singles and doubles approach tends to lead to investments in higher quality dividend growth/cash flow growth companies. On the other hand, there are times when a company's stock price seems to be trading below its fair valuation. Short term gains are possible in these situations. I have been managing investment portfolios for individuals and institutions for over fifteen years and believe investing is like running a marathon and not a sprint. Taking the road less traveled, more often than not, leads to higher returns. Visit: The Blog of HORAN Capital Advisors at (https://horanwealth.com/insights/market-commentary-blog)

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Comments (3)

Style and Asset Class are you covering up the anomaly of quantitative versus qualitative ?

I wish you would be more deeper in your pronouncement ; here is mine.

Style is the dispersion of matters over size , genderless and more emotion and finally legacy and longevity .

Asset Class is borderless and factual , multi-faceted and novice , and finally you got`it and very public .

I think your article is complete now that I put in my two bits worth .
David hello! Thank you for all the great articles. A question for you and your experience. Do you think is too late to jump into the value trade? I started heavily investing in tech in late December and Jan-March of 2021 into tech stocks. I have very little exposure to more traditional/value plays. The only significant value play I have is the XLF. Does the value trade has some more room to run or should I wait in cash? My tech portfolio is down like 12% most of my ark investments are down 20 or more percent but taking all the growth exposure the little value I have and the hedge funds + cash I am flat on my portfolio while the indices are all time high....What would you recommend me doing? Is it too late to enter value? How long does value over performance on growth lasts? Do you have any idea on mutual funds or etfs that I could put some of the cash. Or the best thing to do is wait? Thank you in advance
Chip Chipperson profile picture
@A Young Financial Advisor Fidelity ZERO funds for your ETFs. FNILX or FZROX are nice. Drop ARK funds like a hot rock! The valuations are absurd. Most of those companies are pure speculation with almost no chance of ever becoming profitable. Wood is the flavor of the day, but know that the macro environment is exposing the flaws in her aggressive style. In 2-3 years, she'll be a pariah on the Street.
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