ECP | Luxemburg, 20.11.2020
A lot is currently being written about the rotation from momentum/growth stocks into value stocks. To us, the extreme value underperformance compared to growth we have seen over the last years can be compared to a rubber band. The more it stretches, the heftier will be the reversal as the situation is more and more unsustainable. November has shown how stretched the rubber band has become during the Coivd-19 crisis. The trigger of a change in market sentiment could be a retreat of the pandemic due to better treatment options or the rollout of a vaccine. That in turn will improve confidence into better economic conditions. Interest rates will start to rise and value will perform better.
Mit freundlichen Grüssen aus Luxembourg
Léon Kirch, CIO & Partner
