Hey! Contrarian Investors, Buy The Unloved 2016

Hey! Contrarian Investors, Buy The Unloved 2016 by Russel Kinnel, Morningstar

Picks in three categories for the contrarian investors.

It's time for our annual "Buy the Unloved" report.

This is a strategy that we have tracked for more than 20 years, and it has proved to be surprisingly resilient. It's really a pretty basic contrarian strategy driven by mutual fund flows. The idea is to look at calendar-year mutual fund flows by Morningstar Category and go in the opposite direction.

The strategy says you buy funds in the three most redeemed categories and sell funds from the three most heavily purchased, then hold on for three or five years. Both time periods work well. Essentially, you use flows to point you...