The Art of Contrarian Trading: How to Profit from Crowd Behavior in the Financial Markets
Why is it so hard to beat the market? How can you avoid getting caught in bubbles and crashes? You will find the answers in Carl Futia’s new book, The Art of Contrarian Trading. This book will teach you Futia’s novel method of contrarian trading from the ground up.
Chapters 1 to 5 develop the foundation on which our method will rest. We answer the question of why some speculators win but most lose, and in so doing we identify the successful speculator’s characteristic edge. Chapters 6 to 11 explain a practical approach to contrarian trading. Here we learn about the contrarian trader’s principal tool, his media diary.
In Chapters 12 to 15 we apply the techniques explained in the preceding chapters to the stock market. I kept my own media diary in real time during the years 1987 to 2008. I think you will be surprised to see how effectively it identified the many valuation mistakes the stock market made during those years.
Chapter 16 contains a small number of very brief essays and notes I wrote for my own benefit as I learned to be a contrarian trader. It explains the development of the theory of contrary opinion, highlights the contributions key individuals made to the theory, discusses briefly several books every contrarian should read, and offers comments on back-of-the-envelope value investing for the contrarian trader.
- Can You Beat the Market?
- Market Mistakes
- The Edge
- The Wisdom and Follies of Crowds
- The Life Cycle and Psychology of an Investment Crowd
- The Historical Context for Market Mistakes
- How Crowds Communicate
- Constructing Your Media Diary
- Important Investment Themes
- Interpreting Your Diary: Market Semiotics
- The Grand Strategy of Contrarian Trading
- The Great Bull Market of 1982–2000
- Collapse of the Bubble: The 2000–2002 Bear Market
- The Postbubble Bull Market of 2002–2007
- The Panic of 2008
- Vignettes on Contrarian Thought and Practice