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Being contrarian can be very lucrative

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I find myself on the back foot defending my position.
Stop!
Rewind!!
I want to be looking forward.

Forget what I said earlier, but thanks for the clarification!


(even Warren Buffett says he doesn't look backwards as it's unproductive).
 

Excellent post, good advice !

Anybody have any contrarian plays there planning/looking at following this year 2011 ?
 
RandR said:
Excellent post, good advice !

Anybody have any contrarian plays there planning/looking at following this year 2011 ?
Click to expand...

If the markets put on 20% plus like some predict I will be looking to take some profits and move to cash.
 
RandR said:
Excellent post, good advice !

Anybody have any contrarian plays there planning/looking at following this year 2011 ?
Click to expand...

Funny you should mention that RandR, I am looking at QBE right now as a contrarian play. It's also coming up for a dividend in March. Still waiting for even lower prices which may come in the next week but by looking at your signature you already hold them. Top up for you maybe?
 
RandR said:
Anybody have any contrarian plays there planning/looking at following this year 2011 ?
Click to expand...

The three big contrarian stock plays i can see for this year are.
  • Real estate (especially those heavily exposed to residential)
  • Pharmaceuticals
  • Infrastructure

Also reckon there will continue to be easy money dividend plays in abundance.
 
So_Cynical said:
The three big contrarian stock plays i can see for this year are.
  • Real estate (especially those heavily exposed to residential)
  • Pharmaceuticals
  • Infrastructure

Also reckon there will continue to be easy money dividend plays in abundance.
Click to expand...

I might venture to add consumer discretionary stocks to that list, So_Cynical. As a wag remarked on YMYC a couple of weeks ago, the louder Gerry Harvey bleats about the state of things, the more one should load up on Harvey Norman (please do not take this as an endorsement to buy HVN - I neither hold nor am particularly interested in HVN).
 
Tysonboss1 said:
Telstra, Toll holdings among others
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While I have no interest in owning TLS, I hope that a turn around in its price might pull the rest of the telecom sector up including my shares in IIN and perhaps even give me a reason to buy some TPN
 
tinhat said:
While I have no interest in owning TLS, I hope that a turn around in its price might pull the rest of the telecom sector up including my shares in IIN and perhaps even give me a reason to buy some TPN
Click to expand...

I am not banking on a quick turn around in it's share price, But it doesn't need to have a quick share price recovery for this stock to generate a sound return. As a matter of fact, I think this stock has such a bad reputation that it may take some time for the share price to recover over $3, But who knows.
 

I got into QBE in January, Im expecting the SP to continue to go down until the report comes through very very shortly. Very much keeping an eye on it for a top up, I agree i think you'll see lower prices over the next week or two most definitly. But a lot really depends upon the report thats due. The dividend is looking fairly attractive atm.
 
TheAbyss said:
Contrarian is one thing but you got to do your research to know when to risk it .
Click to expand...

That goes without saying with any investment.

Contrarian investing is not about buying things just because the go down, it's about examining the facts and finding areas where the market has over reacted or come to the wrong conclusions and take advantage of it.
 
http://www.theage.com.au/business/sh...204-1agzb.html

theage.com.au said:
■ In February last year Gunns fell 26 per cent in a day. In the next three months it fell another 60 per cent.
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Hey i brought Gunns about a week after there big drop and for the next 3 months watched my trade go very bad on me and then watched it come good over the next 2 months and eventually see it trade at about 20% over my buy in price.
 

That got nothing to do with being contrarian

That got to do with catching a falling knife or buy because of big drop

Contrarian is about identified good stock that are out of favor and not price correctly by the market.. Yes big drop maybe part of it but that just one consideration

Oops tb1 beats me to it -
 
If I was really a contrarian investor I should be taking profits now. The Dow Jones is heading almost straight up and almost every broker/analyst is predicting a 10-20% rally on the ASX this year.

I did sell my MND holdings recently but this is more to do with my policy of buying companies at a discount to IV and selling when the sp is at a substantual premium to IV.

The rest of my portfolio is full of companies that IMO are not overpriced. (FGE, MCE, DWS, FRI, ISS and ONT). I did take some profits on ONT @ $4.15 but only to top up some other holdings. (5% of portfolio is speculation stocks).

The other thing to consider is capital gains tax, my two largest holdings FGE and MCE are 65.8% of my entire portfolio but if I were to take profits on these companies it would incur a significant CGT bill. Combine that with a positive long term view on both companies I will not diversify unnecessarily nor will I trade on short term macroeconomic indicators.
 

I thought a number of posts in the last few weeks on stocks justified reviving them under this thread, as being views of contrarian investors about to jump in. The stocks discussed were:

LNC - Linc Energy
CKF - Collins Foods
WHC - Whitehaven Coal (this came from the AFR)
MBN - Mirabela Nickel
MCE - Matrix Composites and Engineering

Grateful any thoughts on other contrarian plays (especially if you're onto something that Orbis is doing in this space), or whether you think any of the above remain in the 'falling knife' category.
 

MBN should have a bit of a bounce in the short term at least. Though they have mentioned capital raising so gotta watch out for that too.
 
skyQuake said:
MBN should have a bit of a bounce in the short term at least. Though they have mentioned capital raising so gotta watch out for that too.
Click to expand...
I think that trade was there on Thursday at the close.
Even that would have been a bit of stab in the dark.
I'd find it rather hard to long after Fridays bounce.
Not sure what could make you think that?
 
StumpyPhantom said:
Grateful any thoughts on other contrarian plays.
Click to expand...

The Insurers are all looking a little contrarian at the moment..with QBE and AMP perhaps looking like slightly better value than SUN .. 12 month comparison chart below.
~
 

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