Globally and domestically I think “momentum/GAAP (growth at any price)” stocks have passed the “peak on euphoria” stage (Facebook + WhatsApp were the peak) and the broader equity markets are in the “mature on optimism” stage.
I think it’s absolutely clear we have reached an inflection point in the GAAP/momentum vs. GARP (growth at the right price)/value relationship and I am now aggressively tilting our equity strategy to reflect that. In this world of hashtags #Iliketocallourstrategy #sellharesbuytortoises
As I have been warning for weeks, I think we are seeing a clear peak in ‘momentum’ being the main driver of share price performance. Momentum as an investment variable has peaked and you will continue to see money rotated from expensive momentum stocks to better value/yield/GARP laggards over the months ahead.