Your guide to contrarian investing

At its simplest, taking a contrarian investment approach means going against current market trends.

There are different levels of being a contrarian investor. For some investors being contrarian is merely
holding more or less of a particular stock relative to the market or their peer group, or taking one or two
different investment positions.

At Allan Gray, being contrarian is much more.

For us, contrarian investing means buying an investment when it’s undervalued in a less optimistic environment, and then selling it when its price has improved.

We actively look to buy shares that others are selling and sell when others are buying. Why? Because if you buy and sell the same shares as the majority of investors, at the same time, it is by definition almost impossible to outperform the market.

Our contrarian approach is not about being different just for the sake of it, but driven by performance and a desire to succeed. To seek better-than-average returns, you need independent thinking. You can’t just follow the herd.

This guide will give you an understanding of the Allan Gray contrarian investment approach. It also uses empirical research to demonstrate how this strategy provides value by diversifying portfolios and recognising opportunity where it is being overlooked.