Welcome to Thoughts in the Market, I'm Andrew Sheetz, chief cross-assist, strategist for

Morgan Stanley.

Along with my colleagues bringing you a variety of perspectives, I'll be talking about trends

across the global investment landscape and how we put those ideas together.

It's Friday, February 26th at 2pm in London.

A running joke and investing probably as old as time itself is that the key to the market

is simply buying low and selling high.

But as self-evident as this advice might seem, which is kind of the point of the joke,

for the last five years, it's often been wrong.

The best performing strategies were often those that focused on momentum, buying assets

that were already going up, and selling assets that were already going down.

Consider the following.

Until about two weeks ago, a strategy of buying stocks that had gone up the most outperformed

the S&P 500 by over 44% over the last five years, buying high worked.

Trying to buy low, meanwhile, was also pretty challenging.

There are many, many ways to define value in the stock market, but if we use the definitions

of the Russell indices, the more expensive half of the US market has outperformed the

cheaper half of the market by about 110% over the same five-year period.

Now, there are some fundamental reasons for this dynamic.

The more expensive half of the market contain to many companies that have been major winners

from greater technological investment and disruption.

These stocks rose and then kept rising as that disruption continued rewarding investors

...