Contrarian investor Bernie Schaeffer uses a combination of technical, fundamental and sentiment indicators to find his stock trading positions.

In his Schaeffer's Investment Research, the advisor looks to contrarary calls on insurance, housing and healthcare for the latest three additions to his "Master Trading Portfolio."

"I initiated a long position in Aflac (NYSE: AFL), which had reported earnings on October 23 that had surpassed analysts' estimates by 2 cents per share.

"AFL is currently trading near the 33 level, which acted as support during October. Further support may come from the stock's 200-month exponential moving average.

"Option speculators are pessimistic toward AFL, as nearly 10 puts have been purchased (to open) for every call for AFL on the International Securities Exchange and Chicago Board Options Exchange during the past 10 days. An unwinding of this pessimism could drive the shares' price higher.

"In addition, I initiated a long position in Meritage Homes (NYSE: MTH). The stock is trading more than 5% higher today. MTH is currently trading near the 7 level, which acted as support in January 2008.

"Option speculators are pessimistic toward MTH. The stock's Schaeffer's put/call open interest ratio is 4.99, a reading that is higher than 90% of those taken during the past year. An unwinding of this pessimism could drive the shares' price higher.

"I have also taken a long position in my master portfolio in Stericycle Inc. (NASDAQ: SRCL). Since reaching a pivot low on October 24, SRCL has gained more than 31%.

"The stock is trading above supoprt from its 20-week exponential moving average. Option speculators are pessimistic toward SRCL. More than 4 puts have been purchased (to open) for every call on the International Securities Exchange during the past 10 days.

"In addition, the stock's Schaeffer's put/call open interest ratio is 1.20, a reading that is higher than 84% of those taken during the past year. An unwinding of this pessimism could drive the shares higher."