Value investors will win out: Maple-Brown Abbott
Stagflation fears and the end of easy money have already resulted in the de-rating of many high-flying stocks but it is likely there is still further to go which should favour value investors.
Dougal Maple-Brown, head of Australian value equities at Maple-Brown Abbott, said valuations had reached extreme highs by historical levels and even though they had fallen significantly, they had a fair bit more to go.
“We are currently structuring our portfolios to take advantage of the continuing narrowing in dispersions. We believe our value investing approach will position us to benefit from the emerging opportunities in the current market.”
Maple-Brown said that, depending on which measure was used, the highest-rated stocks were more than three standard deviations more expensive at the peak relative to their lowly rated peers, and many sectors are still above their historical levels.
“Furthermore, after spending such a long time so far above average, it would not be surprising if the situation flipped and the highly-rated stocks traded below long-term averages for a period of time.
“The wide value dispersion in the Australian market suggest that our value style of investing will continue to deliver for our investors,” he said.
AUTHOR
Liam Cormican
Recommended for you
Milford is to launch three funds following consultation with financial advisers while closing two other strategies which hold a small volume of assets.
A founding member of fund manager IML is to depart the firm later this year after 27 years.
Magellan Financial Group reported outflows of $0.5 billion in February but saw a slight increase in its infrastructure division despite the exit of head Gerald Stack.
The global investment manager has unveiled two new diversified ETFs on the ASX targeting the next generation of Australian investors.
