general

Mr. Dreman has given away his secrets on how his fund has been enormously successful over a long period of time. And, following this book, he thinks that a reader also has a good chance of doing it. This is no hyperbole indeed. He has combined finance and psychology better than anyone else has ever done. He has also improved upon his prior work. For a good understanding of not only the stock market, but also the stock-market participants, there is no better book. After reading it, one knows why we encounter so much unreliable advice even from the highly paid financial analysts. If you have ever lost money by investing in a popular stock and you do not want to repeat your mistake, you ought to read this book. The next time you buy a stock that drops in price precipitously, I recommend that you read the book again.

The book explains three simple implementable A-B-C rules of contrarian selection supplemented by five fundamental indicators. Furthermore, Mr. Dreman goes beyond the value investing as he exlains the double play -- value and growth by using GARP, Growth at a Reasonable Price. (This is similar to what I think Warren Buffett is practicing.)

In this book, he explains what stocks in an industry one should buy (low P/E). And, more importantly, he presents a convincing explanation of when to sell.

Mr. Dreman also explains why the strategies explained in the book will not become obsolete for a number of years. I agree with his analysis. The only weakpoint of the book is that he spends much too much space on crticising the efficient market hypothesis. But, you can ignore all that. After all, the efficient market hypothesis is nothing but an argument that it is not easy to make a quick dollar and I think he would agree with that. May be, his reasoning is more psychological than economics.

There are a lot of fads that come and go in the investment world. There are very few of them that pass the test of time or make absolute sense. David Dreman brings clarity to one such strategy: low PE and value investing. It is found in his new book, "Contrarian Investment Strategy: The Next Generation." David Dreman's investment strategy should be the "baseline" to judge the merits of all others. His book is a must read for the serious investor. - Clay B. Mansfield, former Chief Investment Officer of The Pennsylvania Public School Employee's Retirement System.

The basic principles of this book could be boiled down to a paragraph, but Dreman spends more than 400 pages. I agree with contrarian investing, so this book is an essential read if you're a novice, in school, or maybe just starting to risk capital, but not recommended for experienced professionals. A plus is that the book offers practical advice and real life examples, but it is somewhat dated since it was written pre-Internet crash. Another warning is that this book is extremely dry and reads like an academic textbook--reminds me of AIMR's Financial Analyst's Journal, but not as substantive.