3-12-26 The “Value Rotation” Illusion

The market narrative says investors are rotating out of expensive growth stocks and into cheaper value stocks. But is that actually happening? Jon Penn and Michael Lebowitz explain how today’s passive investing landscape can distort traditional definitions of value and growth. ETF flows and index-driven allocations often send capital into the largest and most popular companies, regardless of valuation. Using our three-tier valuation framework—past earnings, forward earnings, and growth-adjusted valuations—we show how investors can better separate stocks that simply look cheap from those that may represent genuine value. We also discuss why traditional screens like low P/E ratios can lead investors into value traps, and how market narratives, psychology, and passive flows can create large valuation gaps across sectors and companies. Understanding the difference between perceived value and true value is critical in today’s market environment. Hosted by RIA Advisors Senior Investment Advisor, Jonathan Penn, CFP, w Portfolio Manger, Michael Lebowitz, CFA Produced by Brent Clanton, Executive Producer 0:00 - INTRO 0:20 - Before the Bell - Markets Making Lower Highs and Lower Lows 2:56 - Dealing with Trapped Longs 5:32 - Negative Divergences Send Warnings 7:35 - Our Strategies Now 11:26 - The Price of Oil & U.S. Dollar 13:52 - Impact of Dollar on Gold, Silver, Precious Metals 17:41 - The Momentum Chase 18:25 - $200 Crude & Futures Markets 22:15 - Crude Oil & Gasoline Futures curves 25:24 - CPI vs Core CPI & The Fed 30:32 - Jerome Powell, Kevin Warsh, & Fed Stance 33:22 - The Value Rotation Illusion 35:51 - What is Value? 38:55 - How Airlines Really Make Money 41:40 - Market Commentary & Blog posting ------- Register for our next Candid Coffee, 3/21/26, and Ask Us Anything: https://realinvestmentadvice.com/resources/events/ask-us-anything/ ------- Do you enjoy our content? Rate us on Google: https://bit.ly/4b9JtEo ------- Watch Today's Full Video on our YouTube Channel: https://youtube.com/live/jW9UWP7WdZY ------- Watch our previous show, "Q&A Day: Technical Breakdown in the S&P 500: What Comes Next?" here: https://youtube.com/live/B2diF0UUrjs ------- Articles Mentioned in Today's Show: "Technical Deterioration: Risk Management Is Key" https://realinvestmentadvice.com/resources/blog/technical-deterioration-an-analysis-of-the-markets-next-move/ "True Value: Looking Through The Value Rotation Illusion" https://realinvestmentadvice.com/resources/blog/true-value-looking-through-the-value-rotation-illusion/ -------- The latest installment of our new feature, Before the Bell, "Markets Reclaim 100-DMA," is here: https://youtu.be/MntZ-KayzxA ------- Download Lance's Latest e-book, "Laws of Money & Wealth:"https://realinvestmentadvice.com/ria-e-guide-library/ -------- SUBSCRIBE to The Real Investment Show here: http://www.youtube.com/c/TheRealInvestmentShow -------- Visit our Site: https://www.realinvestmentadvice.com Contact Us: 1-855-RIA-PLAN -------- Subscribe to SimpleVisor: https://www.simplevisor.com/register-new -------- Connect with us on social: https://twitter.com/RealInvAdvice https://twitter.com/LanceRoberts https://www.facebook.com/RealInvestmentAdvice/ https://www.linkedin.com/in/realinvestmentadvice/ #ValueInvesting #StockMarket #PassiveInvesting #MarketAnalysis #InvestorEducation