The Case For Sticking With Value Stocks

The Case For Sticking With Value Stocks by George Athanassakos, The Globe and Mail

On average, value investing beats growth investing. To me, the evidence is overwhelming. Using Canadian data for the period 1986-2014, my research shows that value beat growth, on average, by about 11 per cent. Figures are comparable for the United States as well as Europe, Australasia and Far East (EAFE) markets.

Investors widely use the terms value stocks and growth stocks, but many don’t know what they mean. The above findings are from academic research, not value-investing practitioners. Academics sort stocks by price-to-earnings (P/E) or other metrics and form a number of portfolios from the sorted stocks. They call the lowest P/E group of stocks...