Think Contrarian Archive
Following the investing herd is one of the most costly decisions you can make. As Humphrey B. Neill says, “When everybody thinks alike, everyone is likely wrong.” Hard evidence backs this up, too.
When the American Association of Individual Investors’ (AAII) sentiment reading falls – meaning investors are skeptical about the market’s direction – stocks tend to rally. In fact, when the reading drops to a certain level, stocks rally over a six-month period. And that’s been true 100% of the time since 1987.
For more information on how being a contrarian investor pays off, check out the articles below.