The Art of Contrarian Trading: How to Profit from Crowd Behavior in the Financial Markets

Back in 1990 I read an article in the July/Aug issue of the Commodity Traders Consumer Report(CTCR)that forever turned my trading mindset around. Carl Futia wrote the article. And no, I don't personally know Mr. Futia, and I have no interests financial or otherwise in his world. But in my 25 years of trading, I can honestly say that this article helped to shape my trading mindset forever. To make a long story short, I'll quote and explain to you the two concepts from that 1990 article that engendered the changes in my trading mind.Concept #1: Quote: "I had seen clearly that if I relied on oscillators and trend-following techniques, I was always getting into the trend too late. It struck me that I should try to "Anticipate" the beginning of trends rather than waiting to enter in the middle after they had started".Concept #2: This concept was the idea of "Free Exposure" which Mr. Futia was taught from a seminar by the legendary trader Peter J. Steidlmayer. In essence Free Exposure meant; To enter the market where the risk is the least and the reward is the greatest, one must find, and be able to read where "Value" lies in the market. All entries made at "Value" are essentially tantamount to a "Free" ride in the market, with very little risk "Exposure".These two concepts started me on my mental journey into what I now call "Anticipating Value" in the market. In any case, back then, after doing months of research and extensive reading on these two concepts my trading was completely turned around for the better. Today, both concepts have melded in one technique, and now form the foundational element of my trading strategy and methodology. Further, since reading this new book, I can see that most of his ideas have since matured into a cohesive philosophy, worthy of anyone's personal library. And by the way, my personal library once numbered over 800 books, so I believe I know a good one when I see it.Thankfully, I too arrived at some of those same conclusions in his book a long time ago. This is because they were the natural and logical progression from his initial concepts in the 90's. Do yourself a favor and at least read this book, even though you may not agree with it now. Some time in the future, after you have been "sorely tested" in the market for a while, you may be truly thankful that you did. It might just spark a new way of looking at the market for you.

As someone who personally trades and follows the markets I was expecting this book to confirm two of the most important words in the title "art and trading". This book as no operational knowledge so with confidence I can say it has no practical use. It is more a collection of short stories that the author has experienced with a theme of "buy when others are fearful". Although in theory at some point this philosophy can make you enormous returns at what point is the question? An example being in the Bear Markets of 2000 and 2008 when triple digit stocks where leveled to single digits and some to zero ( witness the internet stocks or a General Motors). With all of economic and mathematical degrees this author has he should be able to hit the nail on their head with no problem. Unfortunetly this book does not!

I have been investing for 17 years and running money for 10 years this book has provided the key missing factor in my investment strategy a methodoloy for reading market sentiment that is reliable and not used widely by market participants, therefore its gives you a significant edge if employed with fundamental analysis and technical analysis. Since reading this book my ability to time the market correctly has lept signficantly as has my investment results. This book sits with by top 5 investment books with Jame Montier, Bill O'Neil, & Woody Dorsey and various books on Buffetts investment strategies.

There is a wealth of insight in this book for investorts, traders, and speculators alike...I highly recomend it! After establishing what contrary approach to the markets is all about - he goes into his primary tool - the media journal - and outlines two systems: conservitive and aggressive...Only complaints I have is the the rules of each system could have been better tabulated and the aggressive system does have some shortfalls (but all systems have pros and cons)...I recomend using these as part of your own integrated trading sytem that includes fundimntals, technicals, as well as sentiment.

Contrary Investing for the 90's..By Richard Band....You can get this used books for < $ 1. gives better or the same information.