Weighing on the value outlook, the Federal Reserve may still hike interest rates, and energy companies, commodity producers and other firms dependent on emerging markets are vulnerable to losses if rates rise. Additionally, there is no guarantee that a reflation trade benefiting value stocks will develop, especially with the consumer price index showing tepid increases and overall inflation still stubbornly below the Fed’s 2% target.
“Despite its impressive returns, RPG comes with a catch. Its 10-year standard deviation is 15% higher than the S&P 500 , and 19% higher than the S&P 500 Large Cap Weighed Growth Index ETF . The beta tends to run a little higher as well: 1.09 versus 1,” notes Seeking Alpha.
RPG is up nearly 15% over the past 12 months.
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