June 25 (Bloomberg) -- James Montier, voted Europe’s best strategist in the Thomson Extel survey for the past five years, quit Societe Generale SA to join Grantham Mayo Van Otterloo & Co., according to two people with knowledge of the matter.

Montier, 38, who is known for his behavioral analysis of markets, will remain based in London after moving from the French bank to Grantham Mayo’s asset-allocation team, said the people, who declined to be identified before a public announcement. Montier declined to comment when contacted by phone today.

Societe Generale’s former global strategist studies the effect of emotional decisions in investment approaches and has advocated buying so-called value stocks that he believes have been mispriced by investors. Montier advised joining the “dark side” and short-selling stocks in May 2008, before turning more bullish in November after equities plunged.

On March 12, he urged clients to buy stocks in a report entitled “Buy When It’s Cheap -- If Not, When?” The MSCI World Index has since jumped 27 percent.

GMO is based in Boston and manages $78 billion for clients, according to its Web site. Spokespeople for the investment- management company were not immediately available to comment. Antoine Lheritier, a spokesman for Societe Generale in London, declined to comment.

Jeremy Grantham, the 70-year-old chairman of GMO, has been known as a “perma-bear” for his grim view of stocks. He reversed his opposition to equities in 2008 and, in March, 2009, urged investors to shift assets from cash to stocks before “rigor mortis” set in.

Albert Edwards and Andrew Lapthorne, Montier’s colleagues at Societe Generale, will stay with the French bank, the people said.

To contact the reporter on this story: Alexis Xydias in London at axydias@bloomberg.net

Last Updated: June 25, 2009 06:14 EDT