Our investment approach is not for everyone. In fact, it is not for most.
We are contrarian and thus do the opposite of what is popular. Most investors are uncomfortable, or even psychologically incapable, of acting in opposition to the crowd. Michael Steinhardt, a famous and successful investor, describes the contrarian approach by saying, "When views are truly contrarian, they are inevitably uncomfortable. Courage and the ability to withstand pain are required."
Also, we are willing to concentrate our investments in a few large positions. Most investors have bought Wall Street's advertisement that diversification is critical.
Finally, our investment returns can be volatile. In some cases, after we inititate a position, prices drop. Falling prices may encourage us to take a bigger position. Bigger positions with falling prices can mean higher volatility or at least larger drawdowns. This approach may be antithetical to most people; however, we agree with Warren Buffett who said, "Overall, Berkshire and its long-term shareholders benefit from a sinking stock market, much as a regular purchaser of food benefits from declining food prices."
We only want long term co-investors who are knowledgeable and comfortable with our approach. If you have made it this far, we hope you enjoy the rest of the website.
Contrarian Investors, LLC
Randon A. Samelson