Legendary Contrarian Investor David Dreman (Trades, Portfolio) of Dreman Value Management will be joining GuruFocus for a Q&A session in the next few weeks. Do you have questions about his investing philosophy or top holdings? Post them in the comments section below and check back for his answers.
About David
David Dreman (Trades, Portfolio) is a noted contrarian investor and pioneer in behavior finance. His research has proven that stock that are out of favor as indicated by their P/E ratio performed significantly better than those considered to have better outlooks. Dreman has published five books on this topic; the most recent was Contrarian Investment Strategies: The Psychological Edge, published in 2012.
In addition to his books, Dreman has been a regular columnist for Forbes magazine for 30 years. His research findings have also been published in journals such as The Journal of Behavioral Finance, Financial Analysts Journal, and The Journal of Investing.
Performance
The average annual total return of the Small Cap Value Fund at the end of the fourth quarter was 5.34%, compared to 9.4% for the Russell 2000 Value Index. Since inception in 2003, the fund had an average annual return of 11% versus the Index’s 8.04%.
The fund’s top five holdings during the quarter were American Axle & Mfg. Holdings (AXL), Protective Life Corp (PL), Brinker International (EAT), Microsemi Corp (MSCC), and Aircastle (AYR).
In a 2012 interview with Forbes, Dreman said the firm has a mix of low P/E funds, and that over long enough time periods, low P/E small cap stocks outperformed everything around.
Be sure to also submit your questions to David Herro (Trades, Portfolio) of Oakmark Funds here.
