Not All Value Strategies Are Created Equal (Part 1)

Know what you own.

Daniel Sotiroff 27.05.2021
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Colorful Hot Balloon

After a decade of poor performance, the value factor appears to be in the early innings of a comeback. From September of last year through February of 2021, the Russell 1000 Value Index outpaced the Russell 1000 Growth Index by 13.8 percentage points, leaving devotees rejoicing.

Has it returned for good, or is the value factor just teasing its fans? Regardless of what the future holds, citing the performance of a value index masks the incredible performance gaps across different value investing strategies. For example, Invesco S&P Pure Value ETF (RPV) trounced the Russell 1000 Growth Index by 31.7 percentage points, while the FlexShares Quality Dividend ETF (QDF) outperformed by only 3.7 percentage points.

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About Author

Daniel Sotiroff  Daniel Sotiroff is an Analyst, Passive Strategies Research, for Morningstar.

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