Looking for an “anti-consensus” indicator to help determine potential turning points in market environments, a research note from Morgan Stanley notes that being a contrarian might not be profitable during periods of continually rising stock prices but can be very helpful towards identifying meaningful turning points.
Morgan Stanley: Using contrarian indicator to measure fund performance
The firm compiled a database of European equity funds to measure their performance over time. With this in hand, the investment management adviser used this data to determine five recent points at which the market environment changed and provided material opportunity for investors.
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