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Value Vs. Momentum Performance

Value investors buy cheap stocks and sell expensive stocks, hoping their cheap stocks will get more expensive and expensive stocks will get cheaper. In essence, Value strategies are trades that bet on the convergence of valuation towards the mean. Value works best when the cross-sectional dispersion of valuation narrows from a high level, and vice versa.
-Chun Wang, co-portfolio manager, Leuthold Weeden Capital Management

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