Institutional Investor – April 23, 2020 – By Julie Segal

Value and small cap – normally standouts during recoveries — are dismal.

Equity markets have been rallying since March 23, but performance patterns suggest that this upturn is not the real recovery.

Value and small cap – normally standouts during recoveries — are the two of the worst performers in the current run-up, according to Style Analytics, a research and factor analytics firm. “This raises questions about whether the recovery has begun or whether this rally is just a momentary rise in the middle of a larger overall market crash,” wrote Damian Handzy, Style Analytics’ chief commercial officer, and James Monroe, a client consultant. “One possibility is that this recovery truly is unique as it is fueled not by market demand and consumer spending but rather by governments and central banks flooding companies with cash.”

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