Value Funds' Doors Closed; Others Opening Up

A headline this week which read, "Value fund manager AJO with $10 billion assets to shut business," was just one in a long line of "value" funds closing down amid this epic market melt-up. Given The Fed's infatuation with disallowing price discovery in the organic sense, and their apparent animus towards savers, it is the tallest of tasks to declare the elusive bull market top to the indices. 

However, deep value names in this spot seem like they have as many stars aligning for them as possible for major bottoms and to benefit from rotation within equities.

Case in point: Energy stocks are flipping red-to-green again this morning, exuding impressive resilience all week just when it looked like they were bound to turn lower and for a fresh leg down in their multi-year bear market.

Materials plays like, CLF X, can also be deemed as part of the value complex in this market are quietly improving to little fanfare, as new market speculators favor TikTok tutorials on weekly call options for the likes of NIO or ZM. 

But back to energy, what makes the resilience this morning all the more impressive is that it is happening as oil services titan SLB gets pounded, down 7% now, after earnings. The market may be signaling that this could be an outlier or, perhaps, the last bad SLB report for a while. 

Either way, seeing CVX, below on its monthly chart, fight back to green off the decade-long $70 support zone is crucial--Bear market bottoms and deep value dives are frustrating, annoying, and enough to put $10 billion value fund managers on tilt and close their doors. 

But they are well worth the effort over time for long-term investors with patience. 

As it stands today, ZM has a slightly higher market cap than CVX (think about that one for a minute).

My money is on CVX over the next three-to-five years, to the point where it will not even be close between the two market caps going forward.