Is value rotation beginning of a long reversal trend or a false start?

Recovery driven by reflation trade

The last few years have proven to be quite difficult for value investors.

Indeed, since 2007 the underperformance of value stocks has been massive. Financials have played a big role and this is why we prefer to define 'value' stocks, excluding financials, according to our own metrics.  Even ex-financials, value investing has not been rewarded over the past few years; in the US, particularly from mid-2014 to end 2015 (c -20% of long-short performance). MSCI's Value Weighted index is best performing in 2016  In the eurozone, it was even tougher, during the sovereign crisis 2011-2012 (c -40%) and again in 2014-2015 (c -30%). Over the last year, value ...