Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.
It's too early to get excited, but there are inklings that the value factor may be poised to bounce back this year.
So far in 2019, the S&P 500 Value Index is offering modest outperformance of the S&P 500 Growth Index, a theme seen among the exchange traded funds tracking those benchmarks.
What Happened
The SPDR Portfolio S&P 500 Value ETF (NYSE:SPYV) is one of the ETFs that tracks the widely followed S&P 500 Value Index. SPYV's growth counterpart is the SPDR Portfolio S&P Growth ETF (NYSE:SPYG).
SPYV's underlying index “contains stocks that exhibit the strongest value characteristics based on: book value to price ratio; earnings to price ratio; and sales to price ratio,” according to State Street.
Apparently, those traits apply to a significant portion of the S&P 500 because the $2.53 billion SPYV is home to more than 380 stocks.
Why It's Important
Value has been trailing growth for nearly the entirety of the recent bull market in U.S. stocks. Over the past three years, SPYG, the S&P 500 growth ETF, is beating SPVY by 1,630 basis points. For the six years ended 2018, SPYV only outperformed SPYG once on an annual basis.
“But is it not uncommon that value investing goes through periods of underperformance relative to the broader market,” said State Street in a recent note. “What has been uncommon has been the length of time low value stocks have underperformed other equities.”
The Federal Reserve's easy monetary policy following the financial crisis has played a significant part in hampering value stocks.
Value's laggard ways “can be due to a number of reasons, but key among them has been the unusual level of monetary accommodation provided by low rates and quantitative easing (QE),” said State Street. “This has driven risk seeking behavior by investors at the cost of fundamentals that normally provide a catalyst for value stocks.”
What's Next
Certain sectors, particularly financial services, could be the drivers of value's resurgence.
“For investors who want to position themselves to capture the potential upside after an inflection point in the cycle, we believe three sectors could be attractive targets: Financials, Resources and Industrials,” according to State Street.
Financials, industrials and energy names combine for about 40 percent of SPYV's roster.
Related Links
Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!