A table shows the average monthly return advantage, or shortfall, of value relative to growth across economic cycles. In addition to four economic phases, the table shows relative returns when value is trading above its fair value, when value is trading below its fair value, and an aggregate advantage or shortfall.
When value is trading above fair value, it lags growth by 0.06 percent per month in expansions, by 0.54 percent in slowdowns, and by 0.28 percent in contractions. When it is trading above fair value in recoveries, value outperforms by 0.12 percent.
When value is trading below fair value, it outperforms growth by 0.09 percent per month in expansions, by 0.43 percent in slowdowns, and by 0.34 percent in recoveries. When it is trading below fair value in contractions, value lags by 0.01 percent.
In aggregate, value matches the return of growth in expansions, lags by 0.05 percent per month in slowdowns and 0.12 percent in contractions, and outperforms by 0.23 percent in recoveries.