Synopsis
Although many people consider bloody-mindedness and stubbornness as being perfect qualifications for a contrarian investor, the approach is in fact a little different than that. Yes, it requires one to act against the crowd. However, it is futile to do so without good reason. A naivå?ve contrarian investor pops into a pub looking for a fight and is delighted if his first opponent is Lennox Lewis. A more seasoned contrarian looks to fight only little old ladies. But looking for the right opponent in a local pub is far from straightforward – little old ladies can sometimes be veteran jujitsu champions – and detecting the easier battles in the stock market is similarly challenging. At first blush, many stocks are attractive and other appealing stocks may initially look like dogs.
There is no trustworthy shortcut to separate the dogs from the delightful. The long cut is the implementation of much hard work. Hard work as in understanding a company's business model, why other investors hate it, what positive factors they might have missed, how its balance sheet and cash flow interact, and whether its valuation is sufficiently attractive. None of that is rocket science perhaps, but that does not make it easy. The bull arguments are often well hidden and can only be discovered through meticulous work, a sceptical mindset, and deep thought.
In this collection of his writings, top fund manager Alastair Mundy takes a contrarian look at a host of topics and issues, providing a range of ideas and approaches and encouraging investors to think hard about their approach to investment. This book should be essential reading for any investor – contrarian or otherwise.
Details
17 October 2012
9780857192561Reviews
It provides a wealth of thoughtful advice and a good pinch of modesty. I would suggest any budding contrarian, or long-term value investors read this book which captures the wisdom, and humour of a brilliant contrarian investor.Peter Lowman, CIO, Investment Quorum
If you want to know how a good investment manager makes money from the stock market, even when they seem to be going against the crowd, this book is a must read. Mundy's insight into the dark mysterious world of professional fund management is refreshing, candid and invaluable.Jeff Prestridge, Personal Finance Editor, Financial Mail on Sunday
Alastair Mundy is one of the greatest contrarians. His new book provides an absolutely essential public service, reminding investors that just because something is popular doesn't make it right, sensible or even worth the price! Crucially this contrarian wisdom, rolled up in this excellent new book, comes with one big plus for the active investor - Alastair is no armchair contrarian as he's been putting his money where his mouth is for many years as a successful fund manager.David Stevenson, columnist for Investment Week and the Financial Times
Any book about investment which can legitimately include Curly Wurlys, cricket, fondue sets and Warren Buffett has got to be worth a read. Mundy's book is witty, insightful and nicely punctures a lot the pomposity of fund managers while reminding us all quite important managing people's money properly is. I laughed continuously throughout but was nodding in agreement with a lot of the simple and sensible messages in these highly readable musings. This book should be read at the height of a bull market or the bottom of a bear market because common sense should always be in vogue but sadly isn't very often.Lawrence Gosling, founding editor, Investment Week
