Justin Carbonneau, partner at Validea Capital Management, said they have started to see a turn in its value models after a number of difficult years. Its ETF, the Validea Market Legends ETF (VALX), uses models based on the strategies of iconic investors and has currently tilted to seven value models and three growth models, with a specific focus on small-cap value stocks.
"Whether or not this is a true long-term reversal in value outperforming growth is yet to be seen, but there are a few reasons that make us think the turn is coming (or has already started), and when it does, value should see a significant and sustained mean reversion in terms of performance," Carbonneau said.
A big driver of value outperforming is interest rates: Value tends to do better during rising rate environments because higher rates and higher expected inflation make future cash flows worth less. Growth stocks are valued more on the future, and value stocks on the present.
Additionally, some of the cheapest stocks are in sectors that have seen dramatic price declines, like energy, or in sectors that haven't kept up with the broader market, like financials.
"If you believe valuations are a predictor of future price returns, like we do, then these are the areas of the market that will help lead the value recovery," Carbonneau said.
Even Caterpillar, one of 2015's worst blue chips, has worked this year, rising 12 percent even as concern about its business in China persists. Subramanian said Caterpillar is a classic example of an industrial value play that often beats the markets during earnings recoveries, but she couldn't quite resist a pun on the company's famous ticker symbol.
"Maybe it's a dead cat bounce," she said. "Or maybe it's a sign that the world is not as bad as people thought.''
— By Tim Mullaney, special to CNBC.com