Contrarian investing is an investment strategy that goes against popular convention. A contrarian investor buys or sells stocks or investments when other investors are doing the opposite.
Contrarian investing is an excellent investment strategy to help you find great stocks at a good value that are out of favor with the general public.
I’m a contrarian investor. And, I think you should be one too!
Famous Contrarian Investors
Contrarian investing is best illustrated by looking at some famous, successful individuals. Warren Buffett is a great example of what a person can achieve if he or she believes in buying when most people are selling and vice versa. Buffett himself has long held that the best advice he can give to any investor is to be patient.
Warren Buffett is famous for saying, “Be fearful when others are greedy, and greedy when others are fearful.” Tweet This!
Patience Is Key To Contrarian Investing
Patience pays off for many contrarian investors. For instance, if an investor buys shares in a company at a very high price when other investors are selling and making a quick profit in the short term, the contrarian knows to hold on the shares.
If the contrarian investor holds on to the shares for another for a long period of time, three or five years for example, that high price will most likely rise.
Of course, all situations are different. In essence, this investor has made much more in terms of ROI or return on investment than his or her counterparts by being patient, thinking in the long term, and being willing to wait for market corrections.