Who is contrarian investing right for?<\/h3><\/div>![\"Danny](\"https:\/\/www.finder.com\/finder-us\/wp-uploads\/sites\/3\/2020\/07\/Danny-Butler.jpg\")
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Finder investing expert Danny Butler answers <\/em><\/div><\/div>Contrarian investing isn\u2019t for the faint of heart. It\u2019s not easy, by any stretch of the imagination, and relies on you being able to \u201ctime the market\u201d as an investor. You also have to have the emotional resilience to hold when things look shaky and sell when you\u2019ve made your profits (rather than get greedy).<\/p>
If you\u2019re after short-term gains (and we hope you\u2019re not, as investing will rarely give them), then contrarian investing definitely isn\u2019t for you. Contrarian investors dedicate time and effort to identifying opportunities where they believe that the consensus view on market movements is wrong. The hope is that, eventually, their decisions will reap rewards as other investors readjust their outlook.<\/p>
This means that you have to be comfortable with uncertainty and with potential short-term losses. If you\u2019re time-poor, and the idea of losing money would give you sleepless nights, a passive investment<\/a> approach might be more up your street.<\/p><\/div><\/div><\/div><\/article>Pros and cons of contrarian investing<\/h3>\n \n Pros<\/h4>\n \n - There is the potential for big rewards when you get it right<\/li>\n
- You have the opportunity to outperform the market<\/li>\n
- If you succeed in the face of adversity, this can be extremely satisfying.<\/li>\n <\/ul>\n <\/div>\n \n \n
Cons<\/h4>\n \n - Substantial time and effort is needed to understand the market and the opportunities to buck trends<\/li>\n
- You may have to wait for considerable time for your contrarian punts to pay off, and sometimes they may not<\/li>\n
- You'll need to be resilient to stick to your guns in the face of opposing market sentiment.<\/li>\n <\/ul>\n <\/div>\n <\/div>\n
Bottom line<\/h3>
Contrarian investing isn\u2019t the most intuitive \u2013 or easiest \u2013 investment strategy to follow, as it involves doing the opposite to what most investors are doing. But with its risks comes the potential for reward, if you time things right, stick to your guns, and stay invested for the long term. Or, if you\u2019re not sure it ticks all your boxes, find out more about alternative investment strategies<\/a>.<\/p>Compare platforms for buying and selling shares<\/h3>Table: sorted by promoted deals first<\/div>\n \n <\/div>\n \n
<\/p>
Contrarian investing isn\u2019t for the faint of heart. It\u2019s not easy, by any stretch of the imagination, and relies on you being able to \u201ctime the market\u201d as an investor. You also have to have the emotional resilience to hold when things look shaky and sell when you\u2019ve made your profits (rather than get greedy).<\/p>
If you\u2019re after short-term gains (and we hope you\u2019re not, as investing will rarely give them), then contrarian investing definitely isn\u2019t for you. Contrarian investors dedicate time and effort to identifying opportunities where they believe that the consensus view on market movements is wrong. The hope is that, eventually, their decisions will reap rewards as other investors readjust their outlook.<\/p>
This means that you have to be comfortable with uncertainty and with potential short-term losses. If you\u2019re time-poor, and the idea of losing money would give you sleepless nights, a passive investment<\/a> approach might be more up your street.<\/p><\/div><\/div><\/div><\/article> Contrarian investing isn\u2019t the most intuitive \u2013 or easiest \u2013 investment strategy to follow, as it involves doing the opposite to what most investors are doing. But with its risks comes the potential for reward, if you time things right, stick to your guns, and stay invested for the long term. Or, if you\u2019re not sure it ticks all your boxes, find out more about alternative investment strategies<\/a>.<\/p>Pros and cons of contrarian investing<\/h3>
Pros<\/h4>\n
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Cons<\/h4>\n
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Bottom line<\/h3>
Compare platforms for buying and selling shares<\/h3>