Contrarian investing is a dynamic field and not a static one. The assumption that it’s a static field is held by the new breed of fashion contrarians, whose only contribution to this field has been to glamorise it and distort the true notion of being a contrarian investor. These fashion contrarians are no different from those with the mass mindset; they only pretend to do things differently, but the moment fear or uncertainty is in the air, they flee for the exits like bandits being chased by the hounds of hell. A true contrarian in most cases understands the basic rules of mass psychology. If you are not familiar with these rules, you are doing yourself a disservice and should catch up on them ASAP. These simple seven rules for contrarian investing will provide the newbie with a firm foundation on which he or she can build from.
At the Tactical Investor, while we embrace the concept of contrarian investing our true focus is on the joining the key rules of contrarian investing with the powerful concept of mass psychology. We believe this is the most robust system out there as psychology is the key driving force behind almost every human action.
We are going to provide a list of rules that we believe are the most important regarding contrarian investing. It will provide both the novice and seasoned trader with ideas that should help improve your trading skills if implemented properly. Discipline and patience are essential traits if you want to succeed; nothing comes easily, for if it did, everyone would be able to do what you are doing.
These contrarian guidelines by no means encompass all the rules associated with the concept of contrarian investing. However, they do provide you with a firm foundation on which to build your investment career.