A contra fund is characterized by its type of investment style against the wind. By buying assets that are either under-performing or struggling at that point in time, a contra fund manager bets against the prevailing market trends. This is achieved with the assumption that the herd mentality practiced by street investors will lead to asset pricing mispricing, which in the long run will pick up momentum, creating opportunities for investors to produce superlative returns. A counter fund is distinguished by its investment style from other funds. A contra fund takes a contrary view of an asset when it either witnesses exuberant demand from investors or is shunned by them due to short-term triggers at a specific point in time.

Contra Fund : As contrast to the prevailing sentiment, these mutual funds invest in stocks and pursue a policy of buying and selling. The underlying assumption is that shareholders ' group behavior always makes the maket at times very costly or very cheap.
Risk :Moderately High