Continuing our work from last quarter, we examine the relationship between value cycles and valuation spreads, and present evidence showing today's wide spreads could hint at the start of a pro-value cycle.
Overinvestment in commodities, energy, and capital goods has been unwinding for five years, as emerging markets cooled. The worst may likely be over, leaving valuations at very attractive levels.
Value investing is not a simplistic factor, but rather a philosophy that requires company-specific research to outperform over the long-term.
We analyze multiple factors to determine the key driver of returns in emerging markets, and assess the implications for today’s investment environment.