PM Pinnacle Question - Value vs. Growth

Why does a value investing strategey outperform a growth investing strategy in the aftermath of a recession?

Wouldn’t you want to rotate from a value to a growth strategy as the economy begins to expand (i.e. in the aftermath of a recession)?

In the answer explaination it also notes that cyclical stocks tend to outperform non-cyclical stocks in the aftermath of a recession which makes sense because cyclical earnings would rise during economic expansions, but I can’t wrap my head around the Value vs. Growth.

Thanks in advance for any input!

It’ a weird one it threw me too.

Just know that value outperfroms immediately after a recession but as the economy starts to expand then you want growth. Essentially there is just a small window of oppurtunity post recession for the value to outperform then its as usual growth.

Yea thats what I figured. The “aftermath of recession” wording is tricky because in the currculium they use absolute terms like “expansions” and “contractions”.


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