Is it time for value investing?

In today's volatile markets, value investing may provide benefits to clients' investment portfolios. Learn more.

With today’s rising interest rates, increased inflation and market volatility, value investing may provide investors with some stability in their portfolios.

Canada Life Investment Management’s latest report offers insights on how this investment strategy can help support a balanced portfolio. While the steady increase in market valuations over the past decade has been largely driven by growth stocks, analysts are advising the time may have come for value investing.

Value companies are “more likely to be the ones that provide dividends and can provide a bit more of a margin of safety for investors during uncertain times.” - Chris Koltek, Institutional Client Portfolio Strategist at Portfolio Solutions Group.

Key takeaways from our latest report:

Value investing is making a comeback

  • Current economic conditions are resulting in value investing coming back in favour.
  • Investor pessimism, along with market and economic drivers may cause some stocks to become undervalued.
  • Now is a good time to understand and assess the value allocation in your portfolio.

Higher interest rates make value investing more attractive

  • Value stocks tend to outperform growth stocks when interest rates are high.
  • Check your portfolio to see if it has a disproportionate weighting to growth with respect to your risk tolerance.

Patience is important

  • Value investing should be viewed as a long-term strategy.
  • It may take many years for a stock’s price to match its intrinsic value.

Active management matters

  • Look for a manager who can layer on strong fundamental analysis. This includes qualitative inputs such as understanding a management team’s strategy, credibility and long-term vision.

Diversification is key

  • Value investing shouldn’t be looked at in isolation:
    • Value and growth both have a role to play in a well diversified portfolio.
    • Incorporate a balanced approach, as no single investment style can be expected to always be dominant. 
    • Ensure your portfolios are appropriately diversified across investment styles to help capture the upside and mitigate against downside risk.

Get the report to learn more about the value investing approach and how your clients can benefit from this strategy.

To learn more about Canada Life’s fund offerings, including funds that take a value investing based approach, check out the resources below and contact your Canada Life wealth wholesaler today.

Featured investment mandates 

Beutel Goodman & Company Ltd. 


Foyston, Gordon & Payne Inc. 

  • Canada Life Canadian Value Fund (Fundata – mutual fund

 Putnam Investments 

  • Canada Life U.S. Value Fund (Fundata – mutual fund

 Setanta Asset Management Ltd. 


This material represents an assessment of the market environment at a specific time and is not intended to be a forecast of future events or a guarantee of future results. This information should not be relied upon as research or investment advice regarding any strategy or security in particular. 

These funds are available through a segregated funds policy issued by The Canada Life Assurance Company or as mutual funds managed by Canada Life Investment Management Ltd. offered exclusively through Quadrus Investment Services Ltd. Make your investment decisions wisely. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently, and past performance may not be repeated. A description of the key features of the segregated fund policy is contained in the information folder. Any amount allocated to a segregated fund is invested at the risk of the policyowner and may increase or decrease in value. 

The views expressed in this commentary are those of this investment manager as at the date of publication and are subject to change without notice. This commentary is presented only as a general source of information and is not intended as a solicitation to buy or sell specific investments, nor is it intended to provide tax or legal advice.  

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