The U.S. stock market has been dominated by technology themes for years.
Foreign stock markets were much less influenced by technology.
Value outperformed growth internationally with financials and energy as key contributors.
"Ultimately, I agree with Dan Rasmussen that the triumph of growth over value in the US has more to do with 'historically unique and rare circumstances.' As Rasmussen pointed out: 'The US has been through an innovation wave ... where these large-cap tech companies have so dramatically performed in terms of their fundamentals such as to be in the top 1% of the historical sample in terms of growth rates of earnings and profits and revenue, and to have done that on such a massive scale was unprecedented.'”https://www.morningstar.com/stocks/why-value-investing-has-worked-better-outside-us
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Dunno. Just wondering. I don’t think anyone really knows.
However, it was reported recently that very large inflows into VOO are continuing, FWIW
The predominance of the Magnificent 7 stocks has been a large influence in recent years.
I don't how the S&P 500 has been balanced between growth and value stocks historically.
Institutions (e.g., S&P, Morningstar) may have different criteria for defining growth/value stocks.
Edit/Add: VOO had over $150 billion of inflows since the start of 2024.
This ETf hasn't had a monthly outflow since 2022.
Data reported by M* in early April of this year.
YTD tells the story. As of yesterday:
SPY,QQQ,VTV(value) 0.9% to 1.7%
PDI(CEF), VTRIX (international value), VXUS(international), VGK(Europe) = 6.9%, 11.6% 14.9%, 21.3%
Inter leads Value Inter, and Europe leads all.
The above is known since 02/2025. Just use a chart and you can see the leaders.
Just remember that for several years, and sometimes since 2010-12, several "experts" told us almost every year...that this year international and EM would be better.
Arnott told us that in 2009.
GMO told us that in 2010.
The founder of PE10, Prof Shiller, told us that in 2012.
It's all documented (here).
Haven’t looked at Grantham lately and he’s been debunked by most here and likely you too. But I think his views closely represent those of the passive inflows skeptics I alluded to.
https://www.morningstar.com/etfs/arcx/spy/portfolio
Since 2000, I only used relative strength + the best risk/reward funds within leading wide range categories + only several funds.
It takes several years to practice it and get better. This way you can't be too long in lagging categories.
US LC tilting growth were the leaders suring 1995-2000 + 2010-24 = about 25 years
Value, international, and SC during 01/2000 to 01/2010 while SPY+QQQ lost in that period =10 years.
VTRIX is an actively managed fund while VXUS is a passively managed index fund.
Comparing iShares MSCI EAFE Value (EFV) to iShares MSCI EAFE (EFA)
and iShares MSCI EAFE Growth (EFG) may yield more relevant results.
https://www.portfoliovisualizer.com/backtest-portfolio?s=y&sl=7fr2X42qQDaHZ0uCWrsLzY
You are correct, in that case, I would use EFV.
Yes. It’s popular because it has worked for many decades. ”Nothing succeeds like success.”.
Is that’s what’s driving the market? Where does relative valuation come into play?
Brings to mind time in the market vs. timing the market.
https://testfol.io/?s=dgfVTheVmuy
I think your point is well made. People that are happy with the things they are invested in are more likely to stay in the market that suits them. There is a lot of noise to the contrary out there.
Well said!