I have been hearing for a long time that value investing is dead compared to growth investing. I don't agree.
The nature of value investing is you have to stick to your guns in periods where the style is out of favor. Sometimes that period is longer and sometimes that period is shorter. If you are a true value investor, you have to stick through thick and thin. It just becomes part of your bones. Does Warren Buffett ever switch to growth investing? No way, no how!
According to many investment people, growth investing has been "in Vogue" since 2009. I think that is just flat wrong. Many of the stocks I own were bought at very low prices since the 2008/2009 debacle. As the growth investors push values up "through the roof", I am just sitting back and thanking them. Keep up the good work! I love it!
When the market gets frothy, like now, there just aren't many deals to be had for the value investor. He is focuses on collecting a good steady stream of dividends. The dividends pay him while he waits. He continues searching and looking. He knows good value when he sees it. In the meantime, he is creating a shopping list of those quality companies that will get dumped with everything else once growth loses its mojo.
Value investing is not for everyone. Many value portfolio managers see assets leaving their funds when growth is the style for extended periods of time. This does not reflect poorly on the portfolio manager. It reflects poorly on those fund owners who just don't understand the nature of value investing. This fleeting type of behavior is one of the reasons why many investors fail to reach their financial goals. Switching funds, stocks, managers, ETF's, etc. at an increasing rate, only weakens their long-term success. It is more like trading your way to financial success. Trading is only successful for the institutional traders who often "blow up" eventually.
The longer the growth style is said to be "in", the more likely the probability of style turning the corner back to value. With many saying growth has been in for 9 years, that is all the reason to stay put on your value orientation!
