| Contrarians
and bargain hunters seek investment opportunities by departing
from conventional thinking. They study the psychology of markets
to exploit mistakes caused by crowd behavior (i.e. the herd instinct).
A pure contrarian acts simply in opposition to everyone else; a second
type questions all commonly
accepted beliefs and trends, acting independently only if
appropriate; a third type becomes contrarian accidentally, by
following some preferred line of reasoning to its logical conclusions
. Notable contrarians and
bargain hunters have included Humphrey Neill, David Dreman, Richard
Band, John Neff, and George
Putnam.
Market
fluctuations have long attracted analysts who try to find predictive
cycles and waves of market behavior. Well-documented cycles
include: the Kitchen cycle (inventories, 3-5 years); the Juglar Cycle (fixed investment patterns, 7-11 years); and Kuznets Cycle (building patterns, 15-25
years). Other more controversial theories include: the Kondratyev Cycle (also called "the long economic cycle,"
about 54 years) in three stages of upswing, crisis, and depression.
The Babsonchart of business barometers uses
statistics and charts to model a 20-year cycle in four stages:
overexpansion, decline, depression, and improvement. The Dow
Theory (based on work by Charles Dow, William Hamilton and
Robert Rhea) postulated three simultaneous movements: (1) narrow,
daily movements; (2) "short swings," over weeks or
months; and (3) the "main movement," lasting at least
three years. The Elliott Wave Theory postulates a 200-year, eight-wave cycle consisting
of five waves up and three waves down, along with cycles within
cycles.
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|
On
two audiotapes
Run time: about three hours total
Narrator: Louis Rukeyser
Author: Janet Lowe (Bargain Hunters and Contrarians)
Author: Ken Fisher (Cycles and Waves of the Market)
Editor: Mark Skousen
Publisher: Knowledge Products, Inc.
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Item
# 10605
Price: $17.95
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