To say that value is difficult to find in the global equity markets would be an understatement. In fact, when we look at all 44 of the developed market regions and regoin/sectors, what we find is that in only ten of them is the median company trading at a discount to its own 10-year average multiple. Furthermore, six of ten of those aggregates are either in the energy or financials sectors and the rest are in either telecom or utilities. Thus, value stock picking has become incredibly concentrated in just a few areas of the global equity market.

Alternatively, stocks trading at a premium to their historical average are in large supply. The most expensive ten sectors by this measure trade at a 31-61% premium to historical averages. These most expensive aggregates are concentrated in consumer staples, health care, industrials and tech sectors. From this data it seems to be almost a unanimous consensus that “value” can be had in consumer staples and tech while energy and financials are nothing but “value traps”. Only time will tell.

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