Is growth stock domination coming to an end?

investmentnews.com:

Relatively speaking, it’s been a rough couple of years for advisors with a value investing tilt.

To wit, the iShares S&P 500 Value ETF (Ticker: IVE) has returned just under 4 percent thus far in 2024, around 15 percent over the past 12 months, and 58 percent in the last five years.

Judged alone, these returns are fine. Nothing to write home about, but nothing for a client to truly complain about either.

Unless, of course, that client takes a quick peek at how growth stock investors have been faring over the same periods. If they do that, then they might be ticked off at their money manager because comparatively it’s no contest.

The iShares S&P 500 Growth ETF (Ticker: IVW) is up 24 percent year-to-date, 34 percent since last year and 107 percent in the past five years. Yep, it’s total victory for the growth side.

And while a value stock-oriented wealth manager may want to blame their relative underperformance on Magnificent 7 mania or excessive government spending or whatever else may or may not be pushing the admittedly richly valued, big-cap tech dominated S&P 500 higher, in the end, the scoreboard, and account statements, don’t lie.

All that said, no tree grows to the sky, as the old saying goes, and that includes growth stocks. A change is gonna come, according to value-oriented advisors. It’s just a matter of when.

Cole Smead, CEO of Smead Capital Management, as well as a value-stock proponent, says history shows that the turn to value stocks “usually kicks off with pretty bad markets.”

“We tell our investors straight up that we think the S&P is going to make nothing over the next decade,” said Smead. “Part of that is not because all stocks do poorly, that’s a misnomer, it’s due to the composition of the S&P 500 and