A recent article in The Wall Street Journal remembered contrarian investor Leo Dworsky, who managed Fidelity’s Contrafund for 16 years and died on September 17th at the age of 87.
In the 1970s and 1980s, the article notes, Dworsky was a well-known contrarian in U.S. stocks. In a 1983 interview, he said, “I enjoy working the gap between reality and what others perceive as reality.” Between 1967 and 1982, his Contrafund was up more than 300% (nearly double the gains of the S&P 500 during that time).
Dworsky earned a law degree at Yale but switched to money management after finding legal work to be dull, the article says. He was hired by Fidelity’s founder, Edward Johnson II, in 1963 and put in charge of managing the Contrafund at its launch in 1967.
Dworsky described one of his toughest challenges as dealing with hot stocks: “If you’re not bullish enough you get trampled on the way up, and if you’re not nimble enough you get tramped on the way down.” In 1982, he told The New York Times that he looked for “crescendos of euphoria and pessimism” when “something has changed for the better but the market has not yet recognized it,” and when “nothing has changed but the market has given too much emphasis to the negatives.”