One sector currently stands out for consideration by those looking for value: commodities/oil, of which a subset might be Russia.
In the Association of Investment Companies' (AIC) statistics to the end of December 2014, the size-weighted average net asset value decline for investment trusts in the commodities and natural resources sector was 23.5 per cent over one year and 38.3 per cent over five years.
JPMorgan Russian Securities trust has declined 45.8 and 36.3 per cent respectively. In contrast, over five years the FTSE All-Share is up 44.8 per cent. But, in the spirit of holiday-period films, is this sector more Where Eagles Dare or A Bridge Too Far?
BLACKROCK WORLD MINING
Previously we tipped BlackRock World Mining (BRWM) at 371p. Since then, as value investors like to say, it has got even cheaper: the current price is around 300p (our other two tips are up, we hastily add), and the discount has widened to about 12 per cent.
We stand by this selection, but anxiously await further news on the dividend. On 10 October 2014 the board announced that it expected to be able to maintain the final dividend at last year's level of 14p, but since that time conditions in the sector have worsened and there has been further bad news on a small portfolio holding, Banro Corporation.
Expect a dividend cut, therefore, but with the total dividend from last year providing a 6.9 per cent yield, this is already being partly priced in.
JPMORGAN EMERGING MARKETS
And Russia? The absence of the rule of law makes us reluctant to dip our toes into pure Russian exposure. An alternative is to look at a generalist emerging markets trust, although with the MSCI Emerging Markets index having exposure of only 4 per cent to Russia, these are unlikely to take us very far in that direction either.
But there may be other reasons for looking at emerging market trusts. Emerging markets have underperformed over the past five years; the Chinese market (Shanghai Composite), while it ended up having a storming 2014, was still down 1.2 per cent in capital terms over five years.
Some of the emerging market countries should be beneficiaries of a lower oil price (others, of course, are oil producers and won't be), as well as being able to increase exports to what seems like a US economy gathering momentum.
Although in the IpsoFacto contrarian portfolio we have BlackRock Latin American, as part of this three-stock recommendation we would go for a generalist trust. Utilico Emerging Markets has been the best performer, but perhaps the infrastructure play is now over-priced.
Investors should bear in mind, however, that BRWM and JMG may both be somewhat influenced by market perceptions of the Chinese economy.
ACENCIA DEBT STRATEGIES
We still like Polar Capital Global Financials and JPMorgan European as contrarian plays, although the latter's discount has narrowed considerably. But to counter the rather economically sensitive first two picks, we look for something different in our third choice.
Hedge funds have performed badly for much of the post-crisis period; as an example, the Brevan Howard Global Macro fund is in negative share price territory over one and three years. Third Point Offshore is by far the best performing of the AIC-listed hedge funds, up 224 per cent over five years, but this is an exception.
For a fund that may be able to exploit a less good economic outcome, we choose Acencia Debt Strategies at 105p. This fund focuses on hedge funds that invest in distressed debt situations.
The backdrop of low interest rates over recent years has not produced the opportunities that might have been expected after the financial crisis, although performance has been good (up 72.3 per cent over five years), but if we get either stronger deflation or interest rates rising quickly, then there should be some attractive buying opportunities in distressed debt. We also like the fund's 3.5 per cent yield.
As ever, contrarian investing is a game of patience.