Is There an Opportunity in Value Stocks?

The gap between the valuations of value stocks and glamer stocks is known as the value spread. This premium arises naturally from the convergence of cheap stocks and expensive stocks toward their respective, their respective fundamental values. When price are converging to fundamentals, value spreads are compressing. That is why periods of value spread compression favor value stocks,. Conversely, periods of value Spread expansions are less favorable for value shares.