Value stocks might finally have their day – and that means great things for a host of long-maligned value exchange-traded funds (ETFs).
Growth has been running up the score against value for more than a decade. However, after a string of underperformance that dates back to 2007, value might finally be poised to flip the script.
Headlines pointing toward progress on COVID-19 vaccines and treatments alike have sparked hope that America will continue its economic comeback. They’re also looking like a potential catalyst for scores of stocks that were driven into deep value territory earlier in 2020.
“Positive vaccine news is a catalyst for value stocks,” says Brandes Investment Partners analyst Brent Fredberg. “The news, paired with the near-record valuation gap between value and growth stocks, could bode well for a sustained, multi-year rotation toward value outperformance.”
Indeed, value stocks have outperformed growth in every economic recovery since 1929, Fredberg adds.
While some investors might prefer to pick out individual value stocks, others looking to reduce their risk might want to consider value ETFs instead. Exchange-traded funds allow investors to tap into dozens, even hundreds of value-priced equities, typically at just a few dollars in management fees annually.
Read on as we examine seven of the best value ETFs you can buy.