Home Logon FTA Investment Managers Blog Subscribe About Us Contact Us

Search by Ticker, Keyword or CUSIP       
 
 
 
Blog Home
Bob Carey
Chief Market Strategist
Bio
X •  LinkedIn
 

  A Snapshot of Growth vs. Value Investing
Posted Under: Themes
Supporting Image for Blog Post

 
View from the Observation Deck  

  1. The month of December was brutal for equity investors. From 11/30/18-12/31/18 (not shown in chart), the S&P 500 Pure Growth Index posted a total return of -9.23%, compared to -12.23% for the S&P 500 Pure Value Index, according to Bloomberg. 
  2. As indicated in the chart, stocks have rebounded nicely in the first half of January 2019. 
  3. The S&P 500 Index closed at 2,610.30 on 1/15/19. It stood 10.93% below its all-time closing high of 2,930.75 on 9/20/18, according to Bloomberg.  
  4. The S&P 500 Pure Growth Index outperformed its value counterpart in four of the six periods featured in the chart. Growth investing topped value investing for the 15-year, 10-year, 5-year and 1-year periods ended 1/15/19. 
  5. The returns through 1/15/19 were as follows (Pure Growth vs. Pure Value): 15-year average annualized (10.22% vs. 9.81%); 10-year average annualized (18.07% vs. 18.03%); 5-year average annualized (9.16% vs. 6.67%); 3-year average annualized (13.88% vs. 14.05%); 1-year (-4.12% vs. -11.43%) and year-to-date (5.68% vs. 6.67%).
  6. As of 12/31/18, the two largest sector weightings in the S&P 500 Pure Growth Index were Information Technology (21.9%) and Health Care (16.4%), compared to Financials (33.0%) and Consumer Discretionary (16.9%) for the S&P 500 Pure Value Index, according to S&P Dow Jones Indices.
  7. We believe that growth stocks would likely assume the leadership role in the market in 2019 if the U.S. were to forge a new trade agreement with China.

This chart is for illustrative purposes only and not indicative of any actual investment. The illustration excludes the effects of taxes and brokerage commissions or other expenses incurred when investing. Investors cannot invest directly in an index. The S&P 500 Index is a capitalization-weighted index comprised of 500 stocks (currently 505) used to measure large-cap U.S. stock market performance. The S&P 500 Pure Growth Index is a style-concentrated index designed to track the performance of stocks that exhibit the strongest growth characteristics based on three factors: sales growth, the ratio of earnings-change to price, and momentum. It includes only those components of the parent index that exhibit strong growth characteristics, and weights them by growth score. Constituents are drawn from the S&P 500 Index. The S&P 500 Pure Value Index is a style-concentrated index designed to track the performance of stocks that exhibit the strongest value characteristics based on three factors: the ratios of book value, earnings, and sales to price. It includes only those components of the parent index that exhibit strong value characteristics, and weights them by value score. 

Download a PDF of this post, please click here.
Posted on Thursday, January 17, 2019 @ 2:21 PM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
Search Posts
MARKET ANALYSIS
Market Commentary and Analysis
Market Commentary Video
Monthly Talking Points
Quarterly Newsletter
Market Observations
Subscribe To Receive Email
 


 PREVIOUS POSTS
S&P 500 Index Earnings & Revenue Growth Rate Projections
Corporate Earnings Are Expected To Increase In 2019
A Snapshot Of How Stocks Have Performed So Far In This Millennium
2019 Market Outlook
A Snapshot of Bond Valuations
Stock Buybacks by Sector
Call Us Crazy ... Stocks on sale as we head into 2019
Sector Performance Via Market Capitalization (Since Steel/Aluminum Tariffs Enacted)
Top-Performing Subsectors in the S&P 500 Index
S&P 500 Index Earnings & Revenue Growth Rate Projections
Archive
Skip Navigation Links.
Expand 20242024
Expand 20232023
Expand 20222022
Expand 20212021
Expand 20202020
Expand 20192019
Expand 20182018
Expand 20172017
Expand 20162016
Expand 20152015
Expand 20142014
Expand 20132013
Expand 20122012
Expand 20112011

Search by Topic
Skip Navigation Links.

 
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Follow First Trust:  
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2024 All rights reserved.