Small Cap Value heads Rejoice !!!

[Pawpatrol]

Not rejoicing today. It seems the short small cap value long large cap growth trade has restarted with a vengeance. The qqq:ijs ratio kind of broke down after yesterday close but back above the 50d (and of course the 200d ma). Outside a reversion to the mean day i would bet this will likely get worse before it gets better. The reflation trade had us small cap value folks nicely set up - oh well. Stay the course and thats why not 100% SCV.

[stocknoob4111]

Yields going down on the long end is also not a good thing for financials which are overrepresented in the Small Cap indexes. I am not sure when the situation for Small Caps gets better but I am thinking not for the next year or two at least until this whole thing blows over.

[aristotelian]

Not rejoicing today. It seems the short small cap value long large cap growth trade has restarted with a vengeance. The qqq:ijs ratio kind of broke down after yesterday close but back above the 50d (and of course the 200d ma). Outside a reversion to the mean day i would bet this will likely get worse before it gets better. The reflation trade had us small cap value folks nicely set up - oh well. Stay the course and thats why not 100% SCV.

Crazy. SLYV -1.3% right now (was -2.5% when I checked earlier) while the rest of the market is up. Value up, small cap up, Large cap way up, oil up, but small value down. I'm sure there is an explanation but it's a mystery to me. Glad it's not a big part of my portfolio.

[kolder]

There goes all the gains from the last 2 months

[Portfolio7]

I think this is a better time to be buying SCV, rather than to own SCV. That may be true for years to come. Certainly been true for several years already (arguably a decade.)

Commensurate with that opinion, I'm tilted growth, and (slowly) buying value.

Today is one of those days that makes my strategy look good. I'm sure we'll see plenty of the opposite going forward as well. Like Rudyard Kipling, I try to treat both imposters just the same.

[stocknoob4111]

Small Caps are selling off again after hours... I guess this isn't the year from Small Caps, maybe 2021 will yield better luck

[whodidntante]

what the heck is going on this morning? uncertainty good for large cap and bad for small cap?

Can't get too political, but the narrative (perhaps confirming priors or trying to make up some story to make sense of the action) seems to be that a blue White House and red Senate means less stimulus, more "status quo" from the past 6-9 months. This also makes it less likely, it seems, for any major legislation to pass in the next 2 years, to include regulatory issues with the big social media companies and tax laws with some of the other large cap sectors. Note how treasury yields have plummeted too as expectations of large stimulus have reversed owing to the split between the Senate and the Presidency. Maybe that's why big tech is up huge and small cap is down big.

Or maybe that's just me and others trying to rationalize the split. Maybe things will reverse themselves after a day or week or month.

/ Nobody knows anything, as the saying goes

If SCV had outperformed, there would be a narrative for that, too.

[KlangFool]

Folks,

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.


Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.


KlangFool


P.S.: I was hoping for a big drop in SCV and generate some TLH. Instead, I found that I have a significant gain on my SCV purchase in March.

[Pawpatrol]

Not rejoicing today. It seems the short small cap value long large cap growth trade has restarted with a vengeance. The qqq:ijs ratio kind of broke down after yesterday close but back above the 50d (and of course the 200d ma). Outside a reversion to the mean day i would bet this will likely get worse before it gets better. The reflation trade had us small cap value folks nicely set up - oh well. Stay the course and thats why not 100% SCV.

Crazy. SLYV -1.3% right now (was -2.5% when I checked earlier) while the rest of the market is up. Value up, small cap up, Large cap way up, oil up, but small value down. I'm sure there is an explanation but it's a mystery to me. Glad it's not a big part of my portfolio.

Worst day for russell 1000 value vs growth since 2001.

https://twitter.com/sarahponczek/statu ... 26725?s=21

[Pawpatrol]

Folks,

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.


Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.


KlangFool


P.S.: I was hoping for a big drop in SCV and generate some TLH. Instead, I found that I have a significant gain on my SCV purchase in March.

Its compared to a non tilted portfolio i assume most people are talking about vs absolute gains.

[KlangFool]

Folks,

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.


Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.


KlangFool


P.S.: I was hoping for a big drop in SCV and generate some TLH. Instead, I found that I have a significant gain on my SCV purchase in March.

Its compared to a non tilted portfolio i assume most people are talking about vs absolute gains.

Pawpatrol,

Does that mean those folks don't actually invest in the SCV and rebalance accordingly?


KlangFool

[MotoTrojan]

Small Caps are selling off again after hours... I guess this isn't the year from Small Caps, maybe 2021 will yield better luck

Or is this the year for small-caps, because it is the year to be buying?

As long as my value holdings are doing poorly because of multiple compression and not fundamental declines, I am just happy to be in my early-accumulation period and personally prefer things not rerate for years, hell even a decade would be fine.

Toby Carlisle has been talking a lot recently about an interesting point that deeper value realms (P/E in the realm of 10) don't even need multiple rerating to outperform the market as the earnings yield alone is substantial.

Time will tell, but I am a happy buyer. If I were in retirement things may feel a little more concerning.

[Jags4186]

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.

Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.

SCV has done well for me because I rebalance on my birthday which is in March. Luck of the draw! Although, I'll be honest, I don't think I've done better with the rebalance vs. not having rebalanced.

[KlangFool]

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.

Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.

SCV has done well for me because I rebalance on my birthday which is in March. Luck of the draw! Although, I'll be honest, I don't think I've done better with the rebalance vs. not having rebalanced.

Jags4186,

A) Unless you are 100% stock and you do not rebalance between the stock and the bond, that statement cannot be true.

B) If you use 5/25 band based rebalancing, you would have rebalanced twice. Once in March and once more after March.


KlangFool

[Jags4186]

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.

Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.

SCV has done well for me because I rebalance on my birthday which is in March. Luck of the draw! Although, I'll be honest, I don't think I've done better with the rebalance vs. not having rebalanced.

Jags4186,

A) Unless you are 100% stock and you do not rebalance between the stock and the bond, that statement cannot be true.

B) If you use 5/25 band based rebalancing, you would have rebalanced twice. Once in March and once more after March.


KlangFool

I hold a fixed $ of bonds and do not rebalance within my stock/bond allocation. I use bonds + cash as my emergency fund.

[KlangFool]

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.

Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.

SCV has done well for me because I rebalance on my birthday which is in March. Luck of the draw! Although, I'll be honest, I don't think I've done better with the rebalance vs. not having rebalanced.

Jags4186,

A) Unless you are 100% stock and you do not rebalance between the stock and the bond, that statement cannot be true.

B) If you use 5/25 band based rebalancing, you would have rebalanced twice. Once in March and once more after March.


KlangFool

I hold a fixed $ of bonds and do not rebalance within my stock/bond allocation. I use bonds + cash as my emergency fund.

Jags4186,

Then, effectively, your portfolio is 100% stock. You did not get the two rebalancing bonus of this year.

KlangFool

[CyclingDuo]

I really do not understand some of the posts about SCV not doing well. I have 10% SCV and 10% Intermediate-Term Treasury as part of my mini-Larry portfolio. Due to my 5/25 band based rebalancing, I rebalanced in March this year. Aka, selling treasury to buy SCV. Then, later, I was forced to rebalance again when the stocks go up. Aka, selling the SCV to buy the treasury. This is not "market timing". This is rebalancing due to my fixed 10% allocation to SCV and my 5/25 band based rebalancing.

In summary, I harvested some SCV gain and I am still sitting on a fair amount of gain from SCV from my purchase in March.

Please explain why your SCV is not doing well. Did you rebalance in March? If yes, you have a fair amount of gain from March. And, you should rebalance in the past few months and harvested some SCV gain too.

SCV has done well for me because I rebalance on my birthday which is in March. Luck of the draw! Although, I'll be honest, I don't think I've done better with the rebalance vs. not having rebalanced.

You can get any result you want by cherry-picking time periods. But we don’t get to choose when we’re born. Come of age at the wrong time and you might rue the day you read about Eugene Fama and Kenneth French.

https://humbledollar.com/2020/11/factor ... PR8Inv4S-c

Drinking is much more intoxicating than small caps.

CyclingDuo

[YRT70]

I'm surprised by how many people are posting about 1 day results here. Ok I understand the title is inviting but surely we can have some more interesting things to talk about. If 1 year of data is noise, what is 1 day?

[Jags4186]

I'm surprised by how many people are posting about 1 day results here. Ok I understand the title is inviting but surely we can have some more interesting things to talk about. If 1 year of data is noise, what is 1 day?

1 day is jolly conversation.

[YRT70]

I'm surprised by how many people are posting about 1 day results here. Ok I understand the title is inviting but surely we can have some more interesting things to talk about. If 1 year of data is noise, what is 1 day?

1 day is jolly conversation.

IJS is up 2.93% now

[stocknoob4111]

up up and away! S&P600 is clearing some important levels so this may be the breakout from the range that it's been in for the last 10 months.

[RovenSkyfall]

Not rejoicing today. It seems the short small cap value long large cap growth trade has restarted with a vengeance. The qqq:ijs ratio kind of broke down after yesterday close but back above the 50d (and of course the 200d ma). Outside a reversion to the mean day i would bet this will likely get worse before it gets better. The reflation trade had us small cap value folks nicely set up - oh well. Stay the course and thats why not 100% SCV.

Can someone explain to me the significance of this QQQ/IJS ratio I have been seeing recently?

[kolder]

Small Caps are selling off again after hours... I guess this isn't the year from Small Caps, maybe 2021 will yield better luck

Or is this the year for small-caps, because it is the year to be buying?

As long as my value holdings are doing poorly because of multiple compression and not fundamental declines, I am just happy to be in my early-accumulation period and personally prefer things not rerate for years, hell even a decade would be fine.

Toby Carlisle has been talking a lot recently about an interesting point that deeper value realms (P/E in the realm of 10) don't even need multiple rerating to outperform the market as the earnings yield alone is substantial.

Time will tell, but I am a happy buyer. If I were in retirement things may feel a little more concerning.

Me when SCV is doing well: I'm benefitting from the premium!

Me when SCV is doing poorly: I'm accumulating at low prices!

win-win

[MotoTrojan]

Not rejoicing today. It seems the short small cap value long large cap growth trade has restarted with a vengeance. The qqq:ijs ratio kind of broke down after yesterday close but back above the 50d (and of course the 200d ma). Outside a reversion to the mean day i would bet this will likely get worse before it gets better. The reflation trade had us small cap value folks nicely set up - oh well. Stay the course and thats why not 100% SCV.

Can someone explain to me the significance of this QQQ/IJS ratio I have been seeing recently?

Just common/liquid ETFs that track large-growth and small-value. If the ratio is going up, growth is winning (as it has been for a long, long time).

[stocknoob4111]

Wow, I spoke too soon, Small Caps returned with a vengeance today, LOL!

I always love it when the Small Caps are doing well...

[YRT70]

https://humbledollar.com/2020/11/factored-in/

Well yeah US SCV performance has been disappointing. Fortunately one can diversify internationally.

The longest running US small value fund has returned the same as US total market, with greater volatility.
https://www.portfoliovisualizer.com/bac ... ion2_2=100

The longest running international small value fund has returned more than international total market (6.6% vs. 5.5%) .
https://www.portfoliovisualizer.com/bac ... ion2_2=100

The longest running EM small value fund has returned a lot more than EM total market (2.46% vs. 1.1%)
https://www.portfoliovisualizer.com/bac ... ion2_2=100

[kolder]

https://humbledollar.com/2020/11/factored-in/

Well yeah US SCV performance has been disappointing. Fortunately one can diversify internationally.

The longest running US small value fund has returned the same as US total market, with greater volatility.
https://www.portfoliovisualizer.com/bac ... ion2_2=100

The longest running international small value fund has returned more than international total market (6.6% vs. 5.5%) .
https://www.portfoliovisualizer.com/bac ... ion2_2=100

The longest running EM small value fund has returned a lot more than EM total market (2.46% vs. 1.1%)
https://www.portfoliovisualizer.com/bac ... ion2_2=100

I like to look at this backtest:
https://www.portfoliovisualizer.com/bac ... tion5_2=50

Considering it starts and ends at 2 of the worst known drawdowns for value as well

[YRT70]

I like to look at this backtest:
https://www.portfoliovisualizer.com/bac ... tion5_2=50

Considering it starts and ends at 2 of the worst known drawdowns for value as well

Nice! Even better.

[garlandwhizzer]

CyclingDuo wrote:

You can get any result you want by cherry-picking time periods. But we don’t get to choose when we’re born. Come of age at the wrong time and you might rue the day you read about Eugene Fama and Kenneth French.

https://humbledollar.com/2020/11/factor ... PR8Inv4S-c

1+

I read the cited Humble Dollar article and liked it. It is written by an experienced honest investor with no axe to grind one way or the other on the issue of SCV or value in general. He is neither a value nor a TSM ideologue, not that there's anything wrong with being either. In spite of having some skepticism about value he has recently increased his modest allocation to SCV largely because it clearly is on sale relative to growth. I have done likewise, again by a modest amount, not because I believe value or SCV will certainly outperform going forward long term, but rather because I believe that LCG's valuations have departed from their underlying reality due to excessive investor optimism. At these levels I believe the LCG darlings carry something going forward that they haven't carried in almost two decades, increased risk relative to the market. The future IMO will not be replay of the tech collapse of 2000-3, which was a house of cards, but it might rhyme with it. Persistent extreme investor optimism often sows the seeds of its own demise.

Garland Whizzer

[Pawpatrol]

Russell 2000 just hit all time high in premarket taking out the 2018 previous high. This should help scv (ijs/viov/slyv) technically which still needs to go up 19.6% to be even for the year.

[rascott]

Russell 2000 just hit all time high in premarket taking out the 2018 previous high. This should help scv (ijs/viov/slyv) technically which still needs to go up 19.6% to be even for the year.

Look for a blowout day in SCV today. Hope everyone is locked and loaded.

[caklim00]

Russell 2000 just hit all time high in premarket taking out the 2018 previous high. This should help scv (ijs/viov/slyv) technically which still needs to go up 19.6% to be even for the year.

Look for a blowout day in SCV today. Hope everyone is locked and loaded.

Oh my. Wish I had more money to put in play recently, but I'm still holding SCV steady as I always do.

Code: Select all

E-mini Russell 2000 Index Futur (RTY=F)
CME - CME Delayed Price. Currency in USD
Add to watchlist

Quote Lookup

1,758.10+115.00 (+7.00%)
As of 8:26AM EST. Market open.

[vineviz]

Russell 2000 just hit all time high in premarket taking out the 2018 previous high. This should help scv (ijs/viov/slyv) technically which still needs to go up 19.6% to be even for the year.

Look for a blowout day in SCV today. Hope everyone is locked and loaded.

Should we start a pool on the IJS minus QQQ for today?

[YRT70]

I read the cited Humble Dollar article and liked it. It is written by an experienced honest investor with no axe to grind one way or the other on the issue of SCV or value in general. He is neither a value nor a TSM ideologue, not that there's anything wrong with being either. In spite of having some skepticism about value he has recently increased his modest allocation to SCV largely because it clearly is on sale relative to growth.

I'm not sure but given that he's buying more small value when it's cheap I'd say he's at least a bit of value believer.

I’ve put a few more chips on small-cap value stocks, for myself and my family, since they plunged in March, as I mentioned here and here, and I added a little more in October. I have a good rationale for this (there’s that word again).

[rascott]

Russell 2000 just hit all time high in premarket taking out the 2018 previous high. This should help scv (ijs/viov/slyv) technically which still needs to go up 19.6% to be even for the year.

Look for a blowout day in SCV today. Hope everyone is locked and loaded.

Oh my. Wish I had more money to put in play recently, but I'm still holding SCV steady as I always do.

Code: Select all

E-mini Russell 2000 Index Futur (RTY=F)
CME - CME Delayed Price. Currency in USD
Add to watchlist

Quote Lookup

1,758.10+115.00 (+7.00%)
As of 8:26AM EST. Market open.

Russell futures hit the limit up and trading halted.

[rascott]

Russell 2000 just hit all time high in premarket taking out the 2018 previous high. This should help scv (ijs/viov/slyv) technically which still needs to go up 19.6% to be even for the year.

Look for a blowout day in SCV today. Hope everyone is locked and loaded.

Should we start a pool on the IJS minus QQQ for today?

Not ready to jinx it....

[Chrono Triggered]

My oh my.

[7th_Diagram]

And so it begins...

[Mrvtmn]

I only check this thread on days like today.

[occambogle]

Don't have any specific SCV myself, but I've followed this thread for a long time and wishing you all a happy day!

[Forester]

Which Ferrari model are we buying next year?

[Massdriver]

Hey everyone! Good day.

[kolder]

There goes all the gains from the last 2 months

Nevermind

Too bad SCV got clobbered last week though..

[Forester]

$ZIG mostly suffering due to Biogen. $QVAL lagging, heavy in Healthcare and lacks Financials.

[Portfolio7]

This is a day for the true believers! I'm not one of them, but congratulations on a fine day!

[KyleAAA]

Seems intuitive that small and value will benefit more from the vaccine bounce/return to normal than large growth. But we shall see. I rebalanced into small/value from VTI twice over the last 9 months, so I put my money where my mouth is.

[caklim00]

This has to be a top 99.9% for positive spread between SCV and LCG day.

SLYV: +8.67%
MTUM: -1.16%

Guess we just need like 3 of these days

[000]

Just a few hundred more days like this and SCV - QQQ will be back in the black!

[MotoTrojan]

$ZIG mostly suffering due to Biogen. $QVAL lagging, heavy in Healthcare and lacks Financials.

Why did ZIG get so blown up? QVAL has BIIB as well so that doesn't seem to be the ticket. Did some of it's shorts pop? I seem to recall it had a few of the firms crushed by Covid; they did a number on long/short momentum which had it's worst day (driven by the short-side) pretty much ever.

Nice day for Toby's other fund DEEP though!

[MotoTrojan]

SLYV seems to have closed with a 6.66% gain . I would say that is a bad omen, but didn't the S&P500 bottom at 666 points in 2009?