{"id":354,"date":"2009-06-07T12:30:00","date_gmt":"2009-06-07T12:30:00","guid":{"rendered":"https:\/\/clusterfamilyoffice.com\/blog\/?p=354"},"modified":"2009-06-07T12:30:00","modified_gmt":"2009-06-07T12:30:00","slug":"inversion-en-valor-ha-vuelto-o-nunca-ha-dejado-de-existir","status":"publish","type":"post","link":"https:\/\/clusterfamilyoffice.com\/en\/inversion-en-valor-ha-vuelto-o-nunca-ha-dejado-de-existir\/","title":{"rendered":"Value investing. Has it made a comeback, or has it never really gone away?"},"content":{"rendered":"
Most people have a short-term memory and tend to forget the past very quickly. This is often seen in football, where last year\u2019s victories count for little if the team fails to perform at the same level this year, and the manager is quickly called into question, only to be ruthlessly sacked later on if the situation does not improve (except in England, where, fortunately, they allow for long-term projects).<\/p>\n

\"\"<\/a>In the world of finance, this is even more true, if that is possible, as selective memory is compounded by the envy aroused by investors who, year after year, outperform the market, whilst the majority flounder in a sea of mediocrity. Numerous studies indicate that, over a 10-year period, more than 80% of funds prove unable to outperform their benchmark index.<\/p>\n

\"\"<\/a>Just a year ago, numerous voices were raised criticising the heavy losses suffered by funds whose managers are guided by the principle of \u2018value investing\u2019 developed by Benjamin Graham and David Dodd, pointing to their inability to stay out of the market during periods of sharp decline. Many columnists in prestigious newspapers, but above all second-rate bloggers, did not hesitate to call this investment philosophy into question, perhaps driven by that unhealthy envy so prevalent in the Spanish character, or perhaps because it sells better to criticise and kick a man when he\u2019s down.<\/p>\n

\"\"<\/a>This is not the first time comments of this sort have been made. In fact, as far back as 1984, Warren Buffett pointed this out in an article entitled \u201c\u201dThe Superinvestors of Graham-and-Doddsville\"<\/a>, noting how many academics and investment professionals argue that there may be inefficiencies in share prices since, in their view, the market is efficient because its participants have access to a vast amount of information that ensures these prices are fair. Mere luck is used to explain the superior returns of investors who beat the market year after year. Without going too far back, during the tech bubble, the prestigious magazine *Institutional Investor* published a cover story with the following headline: \u201cValue Investing: Can it rise from the ashes?\u201d and even the *New York Times* asked \u201cWhat is killing value fund managers?<\/a>\u201d<\/p>\n

\"\"<\/a>What many did not bother to mention \u2013 probably out of ignorance \u2013 is that, unfortunately for value investing, and this is one of the main criticisms levelled at it (and rightly so), when all the indices experience such sharp falls as we saw last year \u2013 in this case, moreover, triggered by a multi-crisis from which we are still trying to recover \u2013 the market does not distinguish between good and bad companies, and everything falls regardless of whether it was overvalued \u2013 as was the case with banks, insurance companies and property firms, to give a few examples \u2013 or whether its price did not yet reflect the company\u2019s true value.<\/p>\n

\"\"<\/a><\/div>","protected":false},"excerpt":{"rendered":"

La mayor\u00eda de la gente tiene una memoria cortoplacista y tiende a olvidar muy r\u00e1pidamente el pasado. Esto se ve a menudo en el f\u00fatbol, donde las victorias del a\u00f1o pasado de poco sirven si en el presente a\u00f1o no se consigue rallar al mismo nivel, y el entrenador es r\u00e1pidamente puesto en tela de […]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"class_list":["post-354","post","type-post","status-publish","format-standard","hentry","category-sin-categorizar"],"_links":{"self":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/354","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/comments?post=354"}],"version-history":[{"count":0,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/354\/revisions"}],"wp:attachment":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/media?parent=354"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/categories?post=354"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/tags?post=354"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}