The problem with investing in ‘value’ stocks

For the first half of the pandemic a simple investment rule would have served you well: buy anything that was being plugged as a ‘tech’ stock – and dump nearly everything else. Lockdown ushered in a new era in which everything would be done online, rendering the traditional bricks and mortar economy. Since ‘Pfizer Monday’ on 9 November, when the results of the first phase 3 trials of Covid vaccine were made public, the opposite advice has served investors just as well: buy any bricks and mortar company that was dumped during the first phase and sell anything touted as a tech stock. The economy was going to spring back quickly into life, leaving over-valued tech stocks struggling to maintain their toppy values.

International Consolidated Airlines – the parent company of British Airways – has nearly doubled since November. Cruise operator Carnival has also doubled, as have pub operators Marstons and Mitchell and Butlers, while Cineworld is up three times.