With growth stocks outperforming value stocks “by about 13% so far in 2023”, CIO Gary Reynolds accepts “it’s not the best of times” for a value investor like Courtiers.
But despite solid companies with strong balance sheets and low price to earnings ratios “taking an absolute hammering so far in 2023”, Gary says there is no prospect of Courtiers changing its approach just because of “a little turnaround in the market like this.”
Moreover, Courtiers is a value investor for good reason – “because it tends to win over the long-term.” This approach aligns with the long time horizon of Courtiers clients, “who are not expecting us to go chasing quick returns and speculating.”
“Our job is to make sure they can enjoy their capital for the rest of their lives and enjoy the fruits of their labours.”
Yes, he accepts “more money could have been made by piling into Nasdaq stocks”, but as he points out despite market sentiment turning against the value investing style, Courtiers Multi-Asset Funds are still making money in 2023.
What’s “encouraging” about the market’s rotation away from value stocks is that it increases the opportunities to find great companies at decent prices.
If Gary is encouraged by the opportunities in the market, he’s positively “excited” by the potential of AI (artificial intelligence). Not only will there be great opportunities to invest in companies that use AI, but also because AI has the potential to change the world for the better.
By raising productivity AI might even “come to the rescue of the global economy” – including the UK with its shortage of workers. It could also lead to “terrific improvements” in people’s standard of living around the world. For Gary, AI is another example of how despite “mankind’s sometimes abysmal behaviour” the human race continues to move forward.
