On Contrarianism

Contrarian investors take positions that go against the crowd.  This is much more difficult in practice than it is in theory for a couple reasons.  First, people have this tendency to want to agree with what others think.  This is a part of our social nature.  Second, the crowd can be right much longer than many would like to admit.

Nevertheless, there are many traders and investors who claim to be contrarian, which is a contradiction as the more who adopt unpopular positions, the more those positions become the convention.  In fact, the more market participants there are who claim to be contrarians, the more elusive they become.

So when I spot an expression of true contrarianism, one that is articulately expressed and adaptive, it is a gem.

Recently, @ChicagoSean blogged about slowing down in this age of High Frequency Trading.  He writes,

Humble little me with my modest thinkorswim trading account can’t possibly hope to compete against the Robots on speed. Not a chance. So why even try? As trading continues to speed up to unfathomable heights measured in micro-nanoseconds, I keep my focus on trying to find ways to s l o w  d o w n my trading.

HERE you will find the rest of his wonderful post on doing less while the herd does more.


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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