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Contrarian strategies for 2009

Excerpts from Citigroup's report on Contrarian investment strategy:

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The contrarian amongst us would feel this way. As interest rates head to zero in Japan and the Euro zone, very much in sympathy with the US interest rates, the reflation trade could mean a sell-off in bonds, and the flow of the money geyser into commodities, financials and real estate during 2009. The contrarian would be buying Asia Pac, EM equities and Selling US Stocks, US Bonds and Gold.

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As for 2009, the message is very clear. These brave contrarians would now be putting on the reflation trade — buying Financials and commodity stocks and selling defensives, especially in the Pharma & Biotech sector. At a regional level they would be buying back into Emerging Markets and Asia Pac and selling the US.

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