Exploring Contra Funds & Contrarian Investing Strategy
Contra funds help you outperform the market and earn excellent returns.
Contra funds go against the current market trend and invest in stocks that are deemed unpopular.
Contra funds can help you navigate the unpredictable market and unlock hidden opportunities for impressive returns on your investment.
This article will explain all about contra mutual funds, uncover their inner workings, and shed light on essential factors to consider before investing.
What are Contra Funds?
Contra funds are a type of equity mutual fund; they invest against existing market trends and purchase underperforming stocks.
The fund managers adopt an opposite view of the stock when it is shunned by investors or when there is a superlative demand for it.
The basic concept of contra funds is that any exorbitant price tends to normalize in the long run once the triggers subside. Therefore, contra funds invest in undervalued stocks with the potential to grow in the future.