
It takes a special type of person to be a contrarian investor. Few people are willing to buy companies while others predict doom. It means accepting that you won’t always get it right, and the ability to put aside preconceived ideas about a company and focus only on the fundamentals.
One investor who’s made a career of this approach is Simon Mawhinney, Chief Investment Officer at Allan Gray Australia. It was this contrarian streak that saw him buying banks and retailers in middle of the COVID-crash, a decision that turned out better than anyone could’ve expected at the time.
But it doesn’t always go so smoothly, as was the case with his investment in the now-defunct Arrium, which we discuss in this episode of The Rules of Investing. We also discuss two current investments from the Allan Gray portfolio, and one former market darling that he’s investigating currently.
Comments (3)
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Again sold off all the equities in May 2021. I moved to Australia in 2015. Got 80% on INR returns from March 2020 to May 2021 but the returns have been 40% on AUD. After studying currency movements, decided to bring my money here. Now again sitting in cash, have bought some precious metals, some commodities & recently bought a little bit of Alibaba. Waiting for the opportunity to buy equities in bulk for long term.
Saturday Oct 09, 2021
I started investing in 2008 in India as dollar cost averaging in equity mutual funds. Great timing as it was bear market. Of course wasn't a cautious decision. Started working only in 2007. Naturally made huge returns till 2018. Sold all my equities i. 2018 Jan. Enjoyed low returns by investing in Buy-write fund in India till Mar 2020. Then when market gave opportunity in March, invested sizeable portion but due to lack of experience of this kind, couldn't invest all my money (lessons learnt).
Saturday Oct 09, 2021
Very insightful. I have been kind of taking contrarian call for the last 3-4 years since 2018 Jan when the market valuation started going over the roof.
Saturday Oct 09, 2021
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