Mark19 wrote: "French Fama 3-factor model...worked amazingly well from the 1920's through the 1980s. However it has not worked on a consistent basis since 1990. That is 35 years. If something stops working for 35 years, I think it is safe to assume it no longer works. I am a victim of it. I discovered it, just about the time it stopped working."

I'm not so naive to believe that SCV will outperform from all start points. The sector can be bid up and overvalued like any other, and then have relatively poor performance following. But, from my perspective the theory has held up pretty well.

Dimensional Funds Small Cap Value Fund, DFSVX, has been around since the early '90s, and was instituted to embody the theory. Since inception in 1993 it has returned a compound return of 10.8%, according to their website, with an end date of 3/31/2025.

Using Shiller's data I see the S&P 500 was at 450 in March 1993 and was 5612 3/31/2025, for a compound annual growth rate of 8.2%, according to a web calculator.

Looks like a very sizable outperformance to me. Do you disagree?

At the S&P 500's end date, it is/was very richly valued compared to average, despite the recent correction.

At the SCV index's end date it is/was significantly under valued compared to average, having been just a little above average valuation prior to the recent mauling by the bear, which dropped it down 25% from peak as of 4/4/2025.

So, whether or not you believe the small and value factors contribute to long-term outperformance on average, there is a strong argument for investing in SCV at the moment on valuation reasoning. And since it has been and likely will continue to be sold off along with everything else, that valuation is likely to be extremely favorable if this bear market continues to a capitulating bottom like they tend to do.