--- title: May 2019 Size and Style Update - Burney Investment Management description: Optimism around US-China trade relations quickly soured in May as talks about a bilateral agreement broke down, sending the stock market into a free-fall. The S&P 500 lost 6% while the Nasdaq fell 8%. Small Value stocks nearly entered correction territory as the entire market sold off. Sell in May? Market correction occur more frequently ... image: https://burneyinvest.com/hubfs/Imported_Blog_Media/Blog-20190606.jpeg --- [Skip to content](https://burneyinvest.com/blog/may-2019-size-and-style-update#main-content) [![Burney Investment Management](https://burneyinvest.com/hs-fs/hubfs/theme/Burney_Invest_Color_Horizontal_%232b.png?width=300&height=110&name=Burney_Invest_Color_Horizontal_%232b.png "Burney Investment Management")](https://burneyinvest.com/) - About - [Company Overview](https://burneyinvest.com/about) - [Burney Difference](https://burneyinvest.com/the-burney-difference) - Strategies - [Size & Style Responsive](https://burneyinvest.com/strategies/size-style-responsive-ssr/) - [The Burney Master Portfolio](https://burneyinvest.com/strategies/the-burney-master-portfolio/) - [Personalized Portfolios](https://burneyinvest.com/strategies/personalized-portfolios/) - [Stock Selection](https://burneyinvest.com/strategies/stock-selection/) - [Team](https://burneyinvest.com/team) - [Resources](https://burneyinvest.com/blog) - [Get In Touch](https://burneyinvest.com/contact) 6.7.2019 # May 2019 Size and Style Update [Andy Pratt, CFA](https://burneyinvest.com/blog/author/andy-pratt-cfa) ![](https://20453469.fs1.hubspotusercontent-na1.net/hubfs/20453469/Theme/dots_y4.svg) ##### Popular Posts [How to Read VIX and VIX Term Structure](https://burneyinvest.com/blog/how-to-read-vix-and-vix-term-spread) [What Happened in the Stock Market Yesterday?](https://burneyinvest.com/blog/what-happened-in-the-stock-market-yesterday) [Performance Matters - 7 Steps Toward More Effective Investing](https://burneyinvest.com/blog/performance-matters-7-steps-toward-more-effective-investing) ![](https://burneyinvest.com/hubfs/Imported_Blog_Media/Blog-20190606.jpeg) Optimism around US-China trade relations quickly soured in May as talks about a bilateral agreement broke down, sending the stock market into a free-fall. The S&P 500 lost 6% while the Nasdaq fell 8%. Small Value stocks nearly entered correction territory as the entire market sold off. [Sell in May?](https://burney.com/blog/sell-in-may-and-go-away-update/) Market correction occur more frequently than your birthday and, while this selloff doesn’t even qualify as a correction at this point, volatility is the price stock market investors pay for the long-term return premium offered by stocks. This type of volatility is a feature rather than a bug, ensuring stock valuations do not get out of hand. It should be noted that both the US and China have incentives to reach a deal as additional tariffs are a negative for all parties involved. While pessimism abounds, economic conditions stand in stark contrast. First quarter GDP growth was a robust 3.1% and 76% of S&P 500 companies reported earnings above estimates. Companies often beat estimates, but this rate is higher than the 5-year average, indicating analysts and investors had been overly pessimistic. Revisions to second quarter estimates are[more optimistic than usual](https://www.factset.com/hubfs/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_053119.pdf)even in the face of trade concerns. Morgan Stanley made headlines [predicting an imminent recession](https://finance.yahoo.com/news/why-we-could-see-a-recession-in-3-quarters-morgan-stanley-130630148.html) if tariffs spiral out of control. While the [yield curve](https://burney.com/wp-content/uploads/2018/08/Yield_Curve_Note_-_White_Paper.pdf) did invert as investors flocked to safety, a measure that could signal trouble, [treasuries appear overbought](https://www.cnbc.com/2019/05/31/chart-points-to-extremely-overbought-conditions-in-bond-market.html)and the Fed said it would consider [cutting rates if trade issues start negatively impacting the economy.](https://www.wsj.com/articles/trade-risks-prompt-predictions-for-fed-rate-cuts-11559640601?mod=article_inline) Furthermore, [leading economic indicators](https://www.conference-board.org/pdf_free/press/US%20LEI%20-%20Press%20Release%20MAY%202019.pdf) paint a positive picture, making recession concerns seem premature. How are the market conditions impacting our [Size and Style positioning](https://burney.com/strategies/size-style-responsive-ssr/)? We continue to see a lack of momentum either direction with regards to Size. Some months are pro-large companies and some months are pro-small companies, seemingly at random. Until momentum picks up one direction or the other, we will target a neutral posture with Size. The cycling dynamic of Size may be stalled but it remains evident with Style. Momentum has shifted from Growth towards Value and that is where we are positioning portfolios. While Value has struggled relative to Growth over the last decade, it is the segment of stocks historically [offering higher long-term returns.](https://www.cfainstitute.org/research/cfa-digest/2007/05/the-value-premium-and-the-capm-digest-summary) --- *The Burney Company is an SEC-registered investment adviser. Burney Wealth Management is a division of the Burney Company. Registration with the SEC or any state securities authority does not imply that Burney Company or any of its principals or employees possesses a particular level of skill or training in the investment advisory business or any other business. Burney Company does not provide legal, tax, or accounting advice, but offers it through third parties. Before making any financial decisions, clients should consult their legal and/or tax advisors.* ## Articles you may enjoy 12.20.18 #### [Strategies for Dealing with Market Selloffs](https://burneyinvest.com/blog/strategies-for-dealing-with-market-selloffs) [![](https://20453469.fs1.hubspotusercontent-na1.net/hubfs/20453469/Theme/circle_right.svg)](https://burneyinvest.com/blog/strategies-for-dealing-with-market-selloffs) 10.15.15 #### [These 6 Charts Show Why the U.S. is Not Heading for a Recession](https://burneyinvest.com/blog/us-not-heading-towards-recession) [![](https://20453469.fs1.hubspotusercontent-na1.net/hubfs/20453469/Theme/circle_right.svg)](https://burneyinvest.com/blog/us-not-heading-towards-recession) 08.25.15 #### [A Message from our President: Mid-August Correction](https://burneyinvest.com/blog/mid-august-correction) [![](https://20453469.fs1.hubspotusercontent-na1.net/hubfs/20453469/Theme/circle_right.svg)](https://burneyinvest.com/blog/mid-august-correction) ![](https://burneyinvest.com/hubfs/theme/burney-invest-logo-white-1-1.png) - [Size & Style Responsive](https://burneyinvest.com/strategies/size-style-responsive-ssr/) - [Burney Master Portfolio](https://burneyinvest.com/strategies/the-burney-master-portfolio/) - [Personalized Portfolios](https://burneyinvest.com/strategies/personalized-portfolios/) - [Stock Selection](https://burneyinvest.com/strategies/stock-selection/) - [About](https://burneyinvest.com/about) - [Team](https://burneyinvest.com/team) - [Resources](https://burneyinvest.com/blog) - [Contact](https://burneyinvest.com/contact) **Headquarters** 1800 Alexander Bell Dr. STE 510 Reston, VA 20191 Advisory services are offered through the Burney Company, an investment advisor registered with the U.S. Securities & Exchange Commission. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the advisor has attained a particular level of skill or ability. © 2026 Burney Wealth Management | [Research](https://burneyinvest.com/research) | [Privacy Statement](https://burneyinvest.com/privacy-policy) | [Terms & Conditions](https://burneyinvest.com/terms-and-conditions) | [Disclosures](https://burneyinvest.com/disclosures) | [ADV](https://44214779.fs1.hubspotusercontent-na1.net/hubfs/44214779/Burney%20Company%20ADV%20Part%202A%20IM%2026%20REV.pdf) | [Form CRS (ADV Part 3)](https://44214779.fs1.hubspotusercontent-na1.net/hubfs/44214779/Burney%20Company%20Form%20CRS_March%202026.pdf) ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Andy Pratt, CFA", "url" : "https://burneyinvest.com/blog/author/andy-pratt-cfa" }, "dateModified" : "2024-04-01T19:52:00.901Z", "datePublished" : "2019-06-07T13:17:35.000Z", "headline" : "May 2019 Size and Style Update - Burney Investment Management", "image" : [ "https://burneyinvest.com/hubfs/Imported_Blog_Media/Blog-20190606.jpeg" ], "mainEntityOfPage" : { "@id" : "https://burneyinvest.com/blog/may-2019-size-and-style-update", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://burneyinvest.com/hubfs/theme/Burney_Invest_Color_Horizontal_%232b.png" } } } ```