May

11

From the cheap seats, I never really understood the "growth vs value" debate because it always seems to hinge on how you define "growth", how you define "value", and what your endpoints are. So basically it depends on what your initial bias is, which makes it rather a religious debate.

People will point to, for instance, AMZN and say "growth always leads the market", but that view benefits greatly from hindsight. Now the hot discussion is the positive skew of the distribution of returns, but of course that distribution has a positive skew, because it has a hard left edge. For small stocks I always called it "the ICBM effect"- you need to buy a bunch of them so you have a good chance of getting one of the 50-baggers.

I bought AAPL at $10 as a "value" stock and people I knew said I was an idiot. I sold it at $14 and thought I was a genius. If only I had had the foresight to know that I should hold it for another 16 years. Buffet is unloading Big Blue because while there appears to be plenty of value, there's not much growth. But he bought AAPL in the 90s in Q1 2016. Win some, lose some.


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