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If you are looking for an equity fund manager that is capable of producing sustained, market-beating portfolio performance, you might be wasting your time. The roots of this argument can be traced back to Eugene Fama’s efficient market hypothesis published in 1965.

Fama asserted that financial markets are informationally efficient, which simply means that prices on traded assets – including equities, bonds and property – always reflect all known information and therefore are unbiased or efficient.

From the two-decimal-place worlds of economics and finance we know that forecasting is a relatively futile exercise.

In his daily column, Street Dogs, Michel Pireu ( tells the story of David Dreman's "two rooms".

"In his book, Contrarian Investment Strategies in the Next Generation, David Dreman paints a scenario where you enter into a casino with two gambling wings, one red, the other green.

You enter the green room.

The recent market volatility has produced rich opportunity for investors. Whilst many panicked, those investors who were able to see through the hystreria employed market volatility to build investment positions. A recent article by John Reese, founder and CEO of and Validea Capital Management, presented the arguments in a compact fashion.