Value stocks are again underperforming growth stocks but to any even greater degree, according to figures calculated by Woodford's firm.
"The difference is greater than at any stage in stock market history. That tells you all you need to know about current market conditions across the globe," Woodford told the Financial Times.
"Investors have forgotten about risk and this is playing out in inflated asset prices and valuations."
During the tech bubble Woodford, then at Invesco Perpetual, experienced a "painful period of performance" before his investments in sectors such as tobacco paid off when it burst.
Mark Dampier of Hargreaves Lansdown, the investment shop, said Woodford "probably came within about six months of losing his job".
"It was an incredible time. The old world of dividends was thought to be dead, and people didn't think that it would resurface.
"I remember taking a client to see him, and he was banging his fist on the desk saying there would be blood in the streets," said Dampier.
"I hadn't seen him so animated for a very long time - that was less than two months before the top of the market.
"But Neil was absolutely right. Value stocks outperformed growth stocks by a huge margin when the Dotcom bubble burst."
Woodford had a similar success in the build up to the global financial crisis, when he avoided bank shares.
At present the domestically focused stocks that Woodford favours are "unfashionable, unloved and unwanted" according to Dampier.
"Those three factors are usually not bad buying signs. It feels intensely uncomfortable, but usually makes good in the long run," he said.
Woodford has struggled lately after a number of his large holdings faltered.
His income fund has fallen by 8 per cent over six months and has gained only 1 per cent over two years.
The FTSE 100 has delivered a total return of 25 per cent over two years.
A number of investment firms, including Jupiter, have pulled their investment from Woodford Equity Income as a result.
"A consistent feature of bubbles is that there is always a subset of the market that falls out of favour as investors clamour for the fashionable stocks of the day, providing fuel to power the bubble before it bursts," he said.
He said he was "utterly convinced" that his investments would pay off "when the bubble bursts".