This is a transcript of our podcast episode with one of our most popular returning guests, star investor Jim Leitner. He gives his take on the big picture themes of the day, how best to implement trades and much more. While we have tried to make the transcript as accurate as possible, if you do notice any errors, let me know by email


Bilal Hafeez: Hello, Jim. It's great to have you on the podcast once again. I have to say that we've had many, many podcasts over this year and you're the person that is the most requested person to come back on our podcast show.

Jim Leitner: Very nice to hear.



Why the Rotation to Value (From Growth) Theme May Not Work

Bilal Hafeez (00:02:12):: Yeah. So it's great to have you back on, and many people were actually asking that they wanted you on just towards the end of the year to kind of get your views for 2021. And I guess the good sort of starting point would be one of the big themes in markets at the moment is this idea of a rotation from growth stocks back to value.

So it seems obviously for a while now values underperformed, but many outlooks. If you look through all the major banks outlooks, people are saying, "This is the trade. Value is going to outperform growth once again." So maybe we can start with that. You can give us your take and then we can kind of continue our conversation from there.

Jim Leitner: Sure. No. Happy to talk about that. I think it might very well be a good trade. It's really a question of timeframe. I don't think I have an edge on a short timeframe. I think JP Morgan's Kolanovic has done a great job and he's calling for more value versus growth out-performance and I can't say that that's not going to happen over the next month, two months. Who knows?

I don't take bets unless I think I have an edge. So let me talk about value versus growth a little bit. I mean, clearly value is cheaper than growth. Look at the PE ratios, S&P value is at 22 PE, S&P growth is at 36 PE. But really, I believe you need to dig deeper into what industries are you actually buying and selling value versus growth, right?