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From article: "In my experience, one of the singular best investment strategies is to buy assets/asset classes which are most reviled by investors. By reviled, I mean assets where a mere mention of you wanting to invest in them generates nervous sniggers among others, if not howling laughter. Where upon their mention, people hand you business cards, not their own but of nearby psychiatric centres. And where even friends start to doubt your sanity."
Problem with "contrarian investing" is that it is an investment philosophy but not an investment strategy because it doesn't give you any entry and exit points and the successful bets recognized only in retrospect while failed contrarian bets are ignored. People who make that "blood on street" comment never seem to be able to say, when the blood starts flowing and how much more blood is forthcoming to get in. They always talk as if they picked the bottom perfectly with examples in retrospect.
I posted earlier on the abuse of the term to justify a favorite or an otherwise indefensible position.
Reply to @cman: I guess Will Danoff's fund is even guilty of using the "Contra" term incorrectly. His Contra Fund, FCNTX, should be actually renamed "Big Mo" or "Big Grow" according to these articles: fidelity-contrafund-is-really-a-momentum-fund-and-good-at-it
Reply to @bee: Danoff is the contra in contrafund that has done well detecting trends early, using research and intuition to pick amongst them and then making big bets on those sectors contrary to most other managers that only seem to do 2 out of those 3 at best. One of the handful.
Comments
Problem with "contrarian investing" is that it is an investment philosophy but not an investment strategy because it doesn't give you any entry and exit points and the successful bets recognized only in retrospect while failed contrarian bets are ignored. People who make that "blood on street" comment never seem to be able to say, when the blood starts flowing and how much more blood is forthcoming to get in. They always talk as if they picked the bottom perfectly with examples in retrospect.
I posted earlier on the abuse of the term to justify a favorite or an otherwise indefensible position.
fidelity-contrafund-is-really-a-momentum-fund-and-good-at-it
Ted link an interview with Danoff here:
discussion-with-will-danoff-manager-fidelity-contrafund
By the way, he also believe volatiity provides opportunity to make money:
" How will you approach 2014?
Danoff: I am going to stay flexible, as the global markets will be volatile and create opportunities in the coming year. "
http://www.usfunds.com/media/files/pdfs/investor-alert/_2014/2014-01-03/Investor_Alert_01-03-2014.pdf?utm_source=SubscriberMail&utm_medium=email&utm_campaign=IA-01-03-2014&utm_term=Download PDF Version&utm_content=c35a4e567cd7466eaaf4f1a8d1df0917