INTRODUCTION TO THE CONTRARIAN INVESTING PHILOSOPHY
What makes Contrarian Investing so powerful?
When you know what companies you want to invest in before hand, having the confidence of that research, where you buying price range is, knowing the price but also knowing the value of a certain stock mean you will be ready with the knowledge and confidence to buy when everyone else is selling.
Going against the prevailing wisdom takes knowing, discipline and learning how to process and control your emotions to make the hard choices because when you are investing heavy while a stock plunges, “common sense” would suggest you are trying to catch a falling knife. And there is some merit to those objections, though it doesn’t take into account your intimate knowledge of a certain stock and it’s future potential growth, its value, and your price range for nibbling and your price for backing up the truck.
But it’s easier said than done.
Being greedy when everyone else is selling and whole sectors and markets are losing half of their value in a matter of days means you have to have the knowledge (that’s the easy part) but also the mental fortitude to suppress your own fear, because when the market is crashing, it makes sense also be fearful.
And the discipline to be aware of all this and then take action, buy stock, buy real estate, take the risk. And then, if you’re like me, hold onto forever and justify it to friends and family who give you a hard time about your net-worth being directly connected to Tesla :DDDD