There’s been lots of debate in recent years about indexing and passive investing, but some of the greatest investors feel there is a place for indexing. At Value Invest New York 2025, Joel Greenblatt of Gotham Asset Management joined Rich Pzena of Pzena Investment Management for a fireside chat, discussing, among other things, equal-weighted versus market-cap-weighted indexes.
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What is value investing?
Pzena kicked off the discussion with his insight on what value investing is. He thinks every investor will say they buy great businesses at low prices, but he sees a problem. Pzena doesn’t think great businesses sell for low prices, so he said it’s possible to spend lots of time looking, although he’s never found one.
He sees value investing in a more classic sense, noting that many value investors have been depressed about the last 15 years. According to Pzena, they’ve found the last 15 years to be “very normal for a value investor in the returns that have been available to” them” and that they have earned on average.
