Generally, when inflations expectations are rising, we see value stocks favored more than growth stocks. This is due to value stocks being seen as a “short-duration” asset. The reasoning has to do with investors using price multiples, such as price/EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), to categorize equities into either growth or value. An equity with a lower price multiple will return an investor’s capital sooner. In an inflationary environment, a dollar today is worth more than a dollar tomorrow, so the market puts a premium on securities that are considered to have a “short duration.” In contrast, the price of growth stocks is derived from future profits which become more discounted as inflation picks up, lowering their price.