📖John Templeton

Contrarian Investing Model

🌿 Intermediate★★★★★

Buy when others sell in despair, sell when others buy greedily. Without process, there is no reliable feedback loop. Structured execution and review improve decision quality over time. Run a decision loop of research, thesis, execution, and post-mortem; document assumptions and update playbooks with evidence, not hindsight bias. John Templeton advocates a repeatable process: define criteria, execute consistently, and review decisions against evidence. Process quality drives outcome consistency. Key insight: Contrarian action requires courage but generates superior returns. A process is like a pilot checklist: discipline prevents simple mistakes when pressure rises and keeps outcomes more repeatable.

Avoid misuse: Having opinions without execution criteria

💬

To buy when others are despondently selling and to sell when others are avidly buying requires the greatest fortitude and pays the greatest reward.

— Templeton's Way with Money，2012

🏠 Everyday Analogy

A process is like a pilot checklist: discipline prevents simple mistakes when pressure rises and keeps outcomes more repeatable.

📖 Core Interpretation

John Templeton advocates a repeatable process: define criteria, execute consistently, and review decisions against evidence. Process quality drives outcome consistency.
💎 Key Insight：Contrarian action requires courage but generates superior returns.

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❓ Why It Matters

Without process, there is no reliable feedback loop. Structured execution and review improve decision quality over time.

🎯 How to Practice

Run a decision loop of research, thesis, execution, and post-mortem; document assumptions and update playbooks with evidence, not hindsight bias.

⚠️ Common Pitfalls

✕Having opinions without execution criteria
✕Reviewing outcomes but not decisions
✕Abandoning rules during volatility spikes

📚 Case Studies

1
Pre‑Crash Profit Taking (1987)
Ahead of the October 1987 crash, Templeton sold selected U.S. and developed‑market equities that had doubled or more, following his valuation and discipline rules.
✨ Outcome：Losses were limited during the crash, and cash raised was redeployed into high‑quality stocks at distressed prices.
2
1973–74 Bear Market Bottom (1974)
After oil shock and recession, US stocks plunged ~45%. Sentiment was deeply negative and many predicted prolonged stagnation.
✨ Outcome：Templeton bought broadly near lows; over the next decade, US equities entered a long bull market, compounding substantial returns.

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