Marketwatch has an interesting arcticle about 4 of the more contrarian investment managers around and their take on the current market environment: Jeremy Grantham (GMO), Bob Rodriguez (FPA Capital and FPA New Income), John Hussman (Hussman funds), and Steve Leuthold (Leuthold Funds)
I make it a point to always read Jeremy Granthams investment newsletters even though he has caused me to lose some sleep with his predictions about certain investments. He has been a believer in emerging markets for quite some time now but has recently changed his position.
Notably, just a few weeks ago Grantham turned negative on his “beloved” emerging markets, which had been a spot-on bullish call. “If the global economy is going to disappoint, the cost of holding them just seemed too high,” he said.
John Hussman runs the Hussman Growth fund which is what I like to call a “poor-mans hedge fund”.
For Hussman nowadays, risk-taking doesn’t offer much reward. “We’re fully hedged,” the fund manager said, meaning that a portfolio won’t be affected, positively or negatively, by market gyrations.
And ever the contrarian Steve Leuthold has actually turned positive towards equities…
Now Leuthold’s allocation-driven portfolios are covering short positions and other hedges and moving from a neutral, 50-50 equity/bond allocation toward 60% stocks — nearing their 70% maximum threshold.
“Our whole office is surprised,” Leuthold said in an interview “This is quite a departure for us. I don’t believe I’ve ever seen such a dynamic change, going from mildly negative through neutral to pretty positive.”