We’ve been on the ‘new normal’ kick for a while now. Maybe it’s time for a break?
Your punditry team was chatting the other day (actually we do that a lot, but that is one of the most useful parts of the job) and we got off on the topic of turnover. Have you ever wondered why it is that value investors tend to have a fairly long time horizon while growth investors seem to be much more focused on the near term? It would seem that value investors ought to be the ones with the fairly short time frame. Value, if you do it even remotely right, ought to be the approach that would compel you to buy and sell, buy and sell as one investment after another became cheap and then was recognized as being undervalued and bid up. By the same token, true growth companies should work for perhaps decades before the growth fades and they become more pedestrian. So, which group has it wrong? The value investors who wait and wait until even their worst ideas work out? Or the growth folks, who demand instant satisfaction? We think it is mostly the growth folks. Too many ‘growth’ investors are in fact only momentum investors. Read more
