Tag Archives: Contrarian

Why I Love Emerging Markets

Two Reasons:

  1. Because, valuations.
  2. Everyone else fucking hates them.

If you have time and patience, I would be buying these emerging nations. So far this year the EEM is already down about 8%. It probably still has a little ways to go, but at these valuations, how can you hate them over the long run?

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The (work)Week’s End

Hopefully you’re enjoying this government shutdown as much as I’m not. Here’s a few things to read before you head out of the office for the weekend:

Investor Confidence vs. S&P Performance

Spectrem released the numbers for their Affluent & Millionaire investor confidence indexes today and the Affluent index dropped to an 8 month low. While the information available on the indexes are limited, I used the charted data on the link above and placed it against the performance of the S&P 500 (S&P values on the right axis, index values on the left). 

ImageAt first glance, it appears that investor confidence is a great contrarian indicator. Referring back to the index information, looking at the long-term information on the bottom of their chart, it seems as though investor pessimism reached it’s peak right as the market approached bottoms in 2010, 2011, and early 2012. Is this a good time to buy?

Maybe I’m biased as a contrarian, value, long-term investor… but it seems wise to avoid moving with the masses. Be a hipster investor, if you will (even if you hate hipsters).