Where next for the value comeback and how are you gaining exposure?


  • Date: 23/02/2017

Much of what has been characterised as the return of value investing has simply been the recovery from the recent cyclical trough of the basic materials sectors as the underlying commodity prices rallied from levels implying the end of the energy age. There are fundamental and technical reasons to support a rotation back into value stocks, however value investing is hard because it almost by definition goes against received market beliefs.  At a regional level, both Emerging Markets and European Markets look to deliver value – any number of strategists will tell you they are cheap for a reason, but there comes a point where the price discounts too much pessimism.  At a stock level, there is value to be found, but it is not necessarily comfortable investing. UK retailers look cheap and discount a permanent, irreversible and irresistible move away from their business models.  If you believe that there is a place for Next with its three routes to market, resilient brand and more than competent management, then this is a value play the market is ignoring.  In the meantime, you receive a healthy dividend while you find out if you’re right…


Andrew Herberts
Head of Private Client Investment Management (UK)

Article first appeared in:

Investment Week (23rd February 2017) in the Big Question Feature in print.

Opinions, interpretations and conclusions expressed in this document represent our judgement as of this date and are subject to change. Furthermore, the content is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or a solicitation to buy or sell any securities or to adopt any investment strategy.