2020 was the worst year for the value factor. Worse even than 1999.
On this week’s episode of What Are Your Thoughts, I used Alpha Architect’s QVAL as a proxy for value stocks, given that they employ a hardcore, non watered down approach to value. Their active share is 96%!
Because they really do value, and because value really has sucked, their performance has really, really sucked, as you can see below.
I’m a huge fan of the crew at Alpha Architect. They do everything the way it should be done. Not that they need my defense, but I wanted to offer it anyway. They also run a momentum strategy, which is basically the other side of the same coin. Like what they do with value, this portfolio also comes in the purest Alpha Architectian flavor. And since momentum has done really over the last 3 years, they’ve done really really well, as you can see below.
On this week’s What Are Your Thoughts?, special guest Nick Magiulli and I cover value’s recent performance, and much more.
Josh and Michael use YCharts when creating visuals for this show and many aspects of their business. What Are Your Thoughts viewers can get a 20% discount for YCharts by clicking here (new users only):
Michael Batnick is a managing partner at Ritholtz Wealth Management. He is the co-host of Animal Spirits, What Are Your Thoughts, and The Compound and Friends. For disclosure information please see here.
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