Given The Contra Guys excellent long-term record of very high returns using their contrarian investing techniques (26% return annually over 10 years), it's felt that this particular scorecard offers unusual utility. Anyway, yesterday, the first 12 items were given; today, the remaining eleven are shown:
- Positive financial condition +1 or +2
- Amount of time followed +1 to +4
- Book value +1 to +2
- Reasonable price/earnings +1
- Downtrodden industry +1
- Readable annual report +1
- Public awareness +1
- Excellent cash flow +1
- Our understanding of the business +1
- Possibility of a takeover +1
- Intangibles +1
Still, using this scorecard alone in assessing deep value situations isn't going to guarantee success. However, it should improve your chances of success by allowing you to more diligently assess a situation, and also ensuring that you have methodically looked at a number of different areas that can enhance returns.
Perhaps another day, I'll show you another scorecard I've used that's been well "field-tested".
The Confused Capitalist