A Number Of Superb Value Funds Have Recently Reopened

With stock indexes well off their highs and continuing to struggle, many investors, including some of the best value players in the game, are starting to see opportunities.

I first suggested this was the case on January 20: “Some Investors Start To See Value”.

Since I wrote that piece, a number of the best value fund shops in the game have reopened their funds to investors (see also “Is a ‘Great Opportunity’ Knocking?” (subscription required), The Wall Street Journal, February 26): Dodge & Cox, Longleaf, First Eagle, Tweedy Browne and Third Avenue.

What this means is that they see opportunities and feel they can put new funds to good use.

I have nothing but the highest respect for all of these shops and am taking notice.

What I think this means is that a mild recession is now priced into stocks and the only way we go lower from here is if we get a substantial earnings recession.

In fact, I do believe such an earnings recession will come about – but it will take time. 

That’s why I think the Jan 22-23 lows could hold for quite a few months and that a near term re-test of those lows could represent an excellent medium term buying opportunity.