Catching falling knives was a reasonably fruitless activity in 2011. In fact, many of the worst market performers in 2010 were poor once again last year.
As contrarian investors, we must question whether anything has occurred to adversely affect our style of investing in out of favour shares. Is contrarian investing going the same way as boy bands, Curly Wurlys, fondue sets, and shaggy perms? In our view, some rules of engagement have changed significantly. The first is the influence of the economic and financial backdrop. Company turnarounds are most straightforward when economic conditions are sound; there is simply more turnover within an industry to divide between the various protagonists. In weaker times, the battle for turnover r...
To continue reading this article...
Join Investment Week for free
Signup and gain exclusive members-only insights - all free of charge!
- Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
- Get ahead of regulatory and technological changes affecting fund management
- Important and breaking news stories selected by the editors delivered straight to your inbox each day
- Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
- Be the first to hear about our extensive events schedule and awards programmes
