Can Contrarian Investing Pay Off? What To Know About This Warren Buffett-Approved Strategy (2024)

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e=r.searchBoxForm.querySelector("[name=fr]"),n=r.searchBoxForm.querySelector("[name=fr2]");e&&r.config.searchBox&&r.config.searchBox.params&&r.config.searchBox.params.fr&&(e.value=i.searchBox.params.fr,e.disabled=!1),n&&r.config.searchBox&&r.config.searchBox.params&&r.config.searchBox.params.fr2&&(n.value=i.searchBox.params.fr2,n.disabled=!1),r.searchBoxForm.submit()}}),1e3)},r.recognition.onspeechstart=function(){},r.recognition.onspeechend=function(){r.recognition.stop()},r.recognition.onerror=function(){r.speechText&&(r.speechText.innerText=r.i18n.t("search.voice.recognition_error")),r.hideTrending(r),r.showRetryLink(r),r.errorAudio.play()},r.recognition.onaudiostart=function(){r.speechButtonContainer&&r.speechButtonContainer.classList.add("listening")},r.recognition.onaudioend=function(){r.speechButtonContainer&&r.speechButtonContainer.classList.remove("listening")},r.recognition.onsoundstart=function(){r.hideTrending(r),r.noSpeech=!1,r.speechButtonContainer&&(r.speechButtonContainer.classList.remove("listening"),r.speechButtonContainer.classList.add("speaking"))},r.recognition.onsoundend=function(){r.speechButtonContainer&&r.speechButtonContainer.classList.remove("speaking")},r.recognition.onstart=function(){r.recognitionInit(r),r.startRecognition(r)},r.recognition.onend=function(){r.isRecognitionStart=!1,0==r.noSpeech&&""==r.speechResult&&(r.speechText&&(r.speechText.innerText=r.i18n.t("search.voice.recognition_nomatch")),r.hideTrending(r),r.showRetryLink(r),r.errorAudio.play())},document&&document.dispatchEvent&&document.dispatchEvent(new Event("VOICE_JS_READY"))}}o.I18n=m,o.prototype.renderPermissionGuide=function(e){var n='\n

    \n

    \n

    \n

    \n

    \n

    \n

    \n

    '.concat(e.i18n.t("search.voice.permission_title"),'

    \n

    ').concat(e.i18n.t("search.voice.permission_text"),"

    \n

    \n

    \n

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    \n

    \n

    \n

    \n

    \n

    \n \n \n \n \n \n \n

    \n

    \n

    \n \n \n '.concat(e.i18n.t("search.voice.recognition_retry"),'\n

    \n

    \n

    \n

    \n

    \n

    \n ').concat(e.i18n.t("search.voice.trending_title"),'\n \n

    \n

    \n

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e)&&("SpeechGrammarList"in e||"webkitSpeechGrammarList"in e)}}],d=0;d0){var n=e.speechResult.charAt(e.speechResult.length-1);"."!==n&&"?"!==n&&"。"!==n&&"?"!==n||(e.speechResult=e.speechResult.slice(0,-1))}},o.prototype.sendBeacon=function(n,t){var o=e.YAHOO.ULT||{},i=e.YAHOO.SB||{};if(o.beacon_click){var r={_S:i.config.i13n.spaceid,_I:i.config.i13n.pvid,actn:n,sec:"search",slk:t};e.YAHOO.ULT.beacon_click(r)}},o.prototype.ajaxReq=function(t,o){var i,r,a=XMLHttpRequest.DONE||4,s=new XMLHttpRequest;if(n.documentMode&&n.documentMode<10)return(new e.XDomainRequest).onload=function(){try{r=JSON.parse(i),o(r)}catch(e){return}},s.open("GET",t),void s.send();s.onreadystatechange=function(){if(s.readyState===a)if(200===s.status){i=s.responseText;try{r=JSON.parse(i),o(r)}catch(e){return}}else o(r)},s.open("GET",t,!0),s.timeout=1e4,s.send()},e.YAHOO||(e.YAHOO={}),e.YAHOO.Util||(e.YAHOO.Util={}),e.YAHOO.Util.VoiceSearch=o}(window,document)}();var Wn={containerClass:Un.tooltip,textClass:Un.tooltip__text,showClass:Un["tooltip--show"]},Jn=["zh-hant-tw","zh-hant-hk"];ye("ybar-mod-searchbox",(function(e){var n={ybar:document.getElementById("ybar"),searchInput:document.getElementById("ybar-sbq"),buttonBar:document.querySelector(".".concat(Un["sa-btn-bar"])),voiceSearchBtn:document.getElementById("ybar-sbq-voice"),searchForm:document.getElementById("ybar-sf"),searchBoxIcon:document.querySelector(".".concat(Un["searchbox-icon-uh3"])),searchBoxPlaceholder:document.getElementById("ybar-smartphone-searchbox-placeholder"),searchBoxBackButton:document.getElementById("ybar-search-back-btn"),shopsButtonsWrap:document.querySelector(".".concat(Un["shops-buttons"])),categorySelect:document.getElementById("shops-category-select"),selectedMerchantInput:document.getElementById("selected-merchant-input"),selectedMerchantClearButton:document.querySelector(".".concat(Un["selected-merchant-clear-button"])),submitSearchBtn:document.getElementById("ybar-search"),clearSearchBtn:document.getElementById("ybar-sbq-x")};!function(e,n){var t,o,i,r=e.getConfig();if(n.ybar&&"desktop"===r.device&&(null===(t=r.bucketConfig)||void 0===t?void 0:t.highlight_searchassist)&&(null===(o=r.bucketConfig)||void 0===o?void 0:o.overlay_class)){n.ybar.setAttribute("data-ovrly-bkt",r.bucketConfig.overlay_class),null===(i=n.searchForm)||void 0===i||i.classList.add(Un[r.bucketConfig.overlay_class]);var a=document.createElement("div");a.classList.add(Un.overlay,Un[r.bucketConfig.overlay_class]),document.body.appendChild(a),e.onDestroy((function(){document.body.removeChild(a)})),e.addElementListener(n.searchForm,"focusout",(function(e){if(n.searchForm&&n.searchInput){var t=e.relatedTarget;t&&!n.searchForm.contains(t)&&window.YAHOO.SA&&window.YAHOO.SA.apps&&window.YAHOO.SA.apps[0]&&window.YAHOO.SA.apps[0].view.shown&&window.YAHOO.SA.apps[0].view.hide()}}))}}(e,n),zn(e,n),n.voiceSearchBtn&&function(e,n){var t=e.getConfig(),o=t.locale,i=function(){var e,t;(null===(t=null===(e=window.YAHOO)||void 0===e?void 0:e.Util)||void 0===t?void 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    Can Contrarian Investing Pay Off? What To Know About This Warren Buffett-Approved Strategy (2024)

    FAQs

    Can Contrarian Investing Pay Off? What To Know About This Warren Buffett-Approved Strategy? ›

    The concept was summed up best by famed contrarian investor Warren Buffett when he said, “Be fearful when others are greedy, and greedy when others are fearful.” It may take an investor weeks or months to fully develop a contrarian viewpoint, and even more time for their strategy to pay off.

    What are the benefits of contrarian investing? ›

    Contrarian investing, emphasizing a unique mindset, undervalued stocks, and understanding market sentiment, is a potent strategy. By resisting herd mentality, investors exploit market inefficiencies, steering clear of speculative risks. This disciplined approach can yield enduring gains.

    Is Contrarian investing profitable? ›

    Thus, a contrarian strategy can be profitable since the upside can be enormous. Many contrarian investments have the possibility of asymmetric returns—that is, a large potential upside with a limited and measurable negative.

    What is a contrarian investor strategy? ›

    Contrarian investing refers to an investing strategy that looks for profit opportunities in trades that go against current market sentiment. For example, if the market is bullish, the contrarian investor is bearish and will look for opportunities to sell.

    Is contrarian investing risky? ›

    Note that contrarian investing can be risky. Areas are often out of favor for a reason, such as a history of underperformance. Contrarian investment ideas may continue to underperform for extended periods.

    What is a contrarian buy signal? ›

    A contrarian indicator is a form of market indicator that tells a trader it might be a good time to do the opposite of what the majority of investors are doing. For example, a contrarian indicator may tell a trader to buy a stock in the middle of a sell-off.

    What is the contrary opinion rule? ›

    Contrary opinion is the opposite opinion of the sentiment held by the majority. If eighty percent of traders are bearish then a bullish view would be a contrary opinion.

    Is Warren Buffett a contrarian? ›

    Warren Buffett is famous for being a value investor, but much of his approach to investing is also contrarian.

    Does Warren Buffett do value investing? ›

    Some of his most well-known principles include the following: “Price is what you pay, value is what you get.” One of Buffett's most famous quotes highlights his focus on value investing. He believes that it is more important to focus on the value a company provides, rather than simply its stock price.

    What is the number one rule of investing don't lose money? ›

    Buffett's most commonly cited financial advice is as follows, “Rule №1: Never lose money. Rule №2: Never forget rule №1.” So, before investing, determine whether you can lose the money you're investing in.

    What is the number one strategy of investing? ›

    Buy-and-hold investing

    The idea is to not get rattled when the market dips or drops in the short term, but to hold onto your investments and stay the course. Buy-and-hold works only if investors believe in their investment's long-term potential through those short-term declines.

    What is the best contrarian indicator? ›

    3 Top Sentiment Indicators For Contrarian Investing
    • Trading Charts on a Display. getty.
    • Fear/Greed Index. CNN.
    • AAII Sentiment Reading. Ycharts.
    Jun 6, 2024

    What are the three golden rules for investors? ›

    The golden rules of investing
    • Keep some money in an emergency fund with instant access. ...
    • Clear any debts you have, and never invest using a credit card. ...
    • The earlier you get day-to-day money in order, the sooner you can think about investing.

    Does Warren Buffett take risks? ›

    Buffett and his partner, Charlie Munger, avoid transactions with high loss expectancy and prefer those with favorable probabilities, reflecting their risk-averse nature but willingness to take calculated risks.

    Which is considered the riskiest investment strategy? ›

    The riskiest investments are often speculative in nature. While there are investment opportunities in each asset class that could result in you losing some or all of your money, cryptocurrency is often considered to be among the riskiest types of investments.

    What is the opposite of a contrarian investor? ›

    Trend-followers are those investors who buy stocks when the price is high and sell them when the price of a stock falls. However, contrarian investors trade oppositely. They buy the stock when the price is low and sell them when the price is high.

    What are pros cons of passive investing? ›

    Passive investing has pros and cons when contrasted with active investing. This strategy can be come with fewer fees and increased tax efficiency, but it can be limited and result in smaller short-term returns compared to active investing.

    What are the benefits of aggressive investing? ›

    An aggressive investment strategy is a high-risk, high-reward approach to investing. Such a kind of strategy is appropriate for younger investors or those with higher risk tolerance. The focus of aggressive investing is capital appreciation instead of capital preservation or generating regular cash flows.

    Do contrarian investors consider a high put call ratio? ›

    Contrarian investors use the put-call ratio to help them determine when market participants are getting overly bullish or too bearish. An extremely high put-call ratio means the market is extremely bearish.

    What are the pros and cons of growth investing? ›

    What's the difference between Growth vs Value Investing?
    FeatureGrowth Investing
    FocusFuture growth potential
    RiskHigher risk due to potential for overvaluation
    Recent PerformanceOutperformed value investing in the last 25 years
    Potential DrawbacksAbrupt market shifts can cause values to fall
    3 more rows
    Jun 26, 2024

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