Thank you for posting this. It has been a big myth around here that Value, particularly Small Value are trash and not worth investing in. If investors looked at returns for Value stocks in isolation since the 2008-2009 Great Financial Crisis and Great Recession, they would be very pleased with the results, these results are in line with historic returns for the US Stock Market as a whole over many years. These investments only look bad in comparison to the comparison to the returns of US Total Stock Market Index during that same time period. 10% a year looks great until you compare it to 14%, then it looks awful. If you compare to Large Growth, the comparisons are even worse, those returns are probably more like 16%.I think that we need to put things in context.What’s the opposite of performance chasing?
SCV US investing for 15 years must fall into this bucket, lol. Masochist chasing?
Well it’s nice to see SCV sometimes be the only flower on days like today.
For the last 15 years, US SCV has returned a nearly 10% CAGR. LINK: https://testfol.io/?s=j0iDt8q6g1m
If you polled most SCV investors if that is in line with their expectations and whether they are happy with that outcome, I would say absolutely yes.
The problem is that people get into the habit of benchmark anchoring, and the US total stock market had a nearly 14% CAGR. Obviously a splendid outcome, but expected? Not at all, well above expectations. A SCV investor would also likely understand that these things go in cycles and that their plan calls for a long-term allocation, with further understanding that nothing is guaranteed in investing.
A good outcome for Value by itself? Yes. A bad outcome for expecting a premium? Sure, but I wouldn't call this outcome "masochistic" or "catastrophic". Investing comes with risk. The US market's 0% return from 2000-2013 was a significantly worse outcome, and in that period US SCV also did around 10%.
Folks also forget that Value stocks outperformed the broad S&P 500 and Total Stock Market indexes during the lost decade of the 2000's. The broad indexes were essentially flat from March of 2000 though June of 2013, this gets forgotten as well.
Statistics: Posted by nedsaid — Sat Jan 10, 2026 9:25 am — Replies 58 — Views 5046