Lately, you must have come across lots of articles discussing how increasing yields on sovereign bonds have led to rerating of value stocks compared to their growth counterparts. Their entire argument is tied to just the duration of the stock. While we totally agree with their point on duration, where we don’t agree is their top-down approach to investing. Macro outlook does affect stock’s performance, at least in the short to mid-term, but in the long run, it’s the quality of the stock that determines the ultimate winner. And our disagreement boils down to our differing investment time horizons, after all, we are not one of those gunslingers who is in and out of the stock purely based on the news.
“Make your investment decisions based on the news and, one day, you will be the news”