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One of the world’s top-performing global stock funds is betting against Amazon.com Inc.

It’s not so much that Amazon won’t flourish, but that the recent rally in global technology behemoths has made brick-and-mortar retailers cheap in comparison, according to Norwegian fund Storebrand Global Multifactor.

The valuations right now are “too pessimistic for the retailers and too optimistic for Internet retailers,” Andreas Poole, a portfolio manager, said in an interview in Oslo last week. “They won’t struggle as much as today’s pricing indicate. That there actually is value and they will perform better than expected.”

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Technology companies have driven the stock market higher in the past years while traditional retailers have struggled as shopper flocked on-line. Shares of Amazon.com Inc. have risen 64 per cent this year, bringing its price to earnings ratio close to 200.

“Especially Amazon has been popular and is priced with very high growth expectations,” he said. “But we think that these growth expectations long-term won’t be met. Historically, growth expectations on companies aren’t met on average.”

Multifactor holds 300 to 400 companies and seeks to outperform by buying stocks that score highest based on either small size, value, high momentum or low volatility. It has filled its value basket with retailers such as CVS Health Corporation, Macy’s Inc., Best Buy Co., Bed Bath & Beyond Inc., GameStop Corp. and J Sainsbury Plc.

The venerable U.S. department store owner, Macy’s, has a p/e ratio of about 10, for example. The ratio measures the price of the share divided by its earnings.

“It’s not that we think they have a very bright future,” he said. “But the future is a bit brighter than what the rest of the market thinks.”

The fund’s average annual return in dollars in the past five years through July was 11 percent, beating 97 per cent of its peers, according to Morningstar. Its biggest holdings include Micron Technology Inc., Amphenol Corporation, Anthem Inc. and Deutsche Lufthansa AG.

But momentum, rather than value, has been the best performing factor for the fund in 2017 and so far this year.

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“Momentum is typically best when there’s little happening,” he said. “The same type of stocks keeps delivering. It’s usually like that most of the time. The problem with momentum is when there’s a shift. A stock market crash or a sector going from most popular to least popular.”

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