Absolutely. It's a fine line. I've always considered myself crazy, which I feel is a healthy and sane approach :-)
"It's an art, not a science", but when market overreacts to good news, I refrain; when they underreact to good news, I act (generally speaking). Same goes for bad news.
On a general level, I think a falling knives approach works. I think it has been demonstrated relatively convincingly that buying what did worst last year will ("on average") do better than most everything next year, to use a somewhat cliché example. Of course, you may want to stay away from Wirecard and the like (although there may be a time when even such a company have fallen low enough to warrant interest) – that would probably enhance performance.
My main stance is that contrarianism is a good overall mindset – when you receive new information, you internally wonder "what makes that person say/think that way?", and then diplomatically express that question – and then you should also ask that question to yourself and your own beliefs regarding that (and any other) matter. It weeds out stupidity in an effective way, IMO. |
