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Why you should short 'FANG' stocks in 2016: Tom Lee

While the Jim Cramer-coined "FANG" stocks — Facebook, Amazon, Netflix and Alphabet — have enjoyed double- and triple-digit runs this year, over the last week it has seemed like that stretch may be coming to an end. And one noted market strategist thinks you would be best served to short those growth names into 2016.

"One of the challenges is that, when you look at history, groups and especially concentrated performance like this rarely can push through into the following year," Fundstrat Global Advisors' Tom Lee told the "Fast Money" traders Friday. Shares of Facebook, Amazon, Netflix and Alphabet are up a respective 33, 110, 146 and 43 percent year to date.

According to Lee, since 2005, the top 10 stocks of the year have underperformed the following year by an average of 290 basis points — suggesting that what's working one year likely won't work the following. He also says that the elevated price-earnings ratios of these names suggests that in 2016 investors might find opportunity elsewhere.

If this thesis remains true, "frankly, history says it is better to short FANG into 2016," Lee points out in his most recent note.

"I think next year if you see FANG topple," said Lee, "then you'll see value outperform."

Historically, he said, growth and value stocks have been inversely correlated.

"We all agree that the market is on a knife edge here. It's either tipping into no growth or we're tipping back into reflation" said Lee. "I think next year is a big value trade which means you want to buy the stuff that's been garbage but it means the U.S. consumer is doing better, investment picks up, China isn't dying and it's a big value trade."