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Rekenthaler Report

Protecting Against an Expensive Market

A column from the archives on value investing, emerging-markets stocks, and preferred stocks.


Note: This column was originally published on June 21, 2016. Strangely, I would scarcely change a word if I were to write it today. That is because the market trends that prevailed in summer 2016 have continued to prevail, almost unabated. (It is for that reason that historically based fund rankings, such as the Morningstar Rating for funds, have been unusually predictive over the past five years.)

Indeed, two of the column's three suggestions have become even more attractive. Value and emerging-markets stocks are relatively cheaper than in 2016, thereby being even better positioned to defend against price bears. (That doesn't mean that they will profit if the stock market nosedives--probably not--but they should lose less than the glamorous U.S. growth stocks that led on the way up.) 

John Rekenthaler does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.