Text says: Does the manager hold firms with high earnings volatility? If so the manager would be characterized as a value manager because value managers are willing to take positions in cyclical firms.
Aren’t growth managers more focussed on earnings, while value managers more concerned with price? Why would a manager holding firms with high earnings volatility be value and not growth?
A growth manager would probably be looking for consistently positive earnings growth. I think “high earnings volatility” alludes to earnings an earnings scenario that would look something like this:
That type of earnings picture would probably scare away a growth manager.
Because he’s not concerned with the volatility of the earnings, just the price to potential “normalized” earnings.