I’m going to tell you how to be a smart contrarian. Being a smart contrarian, doesn’t mean shorting a stock at new highs, or buying a stock at new lows. Being a smart contrarian, doesn’t mean being bearish when everyone is bullish, or vice versa. Being a smart contrarian, means you need to be patient. Being a smart contrarian, means will make you a lot of money. (If you’re smart about it)

Bottom line, being a contrarian is fucking easy. Being a smart contrarian is about the hardest and most lucrative thing in investing. When I say smart contrarian, I mean placing your bets at the right time. You can be correct about the long term direction of a stock, while going broke before that direction is realized. I take NFLX as a prime example. I fucking knew NFLX was dead.(My old bullshit blog that no one read, HERE) Yet, I had the discipline to hold off until it was a SMART time to be a contrarian. On the way up, I watched NFLX print P/E ratio’s that were off the scale. I held off my shorts, until I KNEW things were on my side.

A smart time to be a contrarian, comes about when a stock(or economy for that matter) is failing, while the vast majority still refuses to believe it. It’s easy to recognize these opportunities. The hard part is making the trade. You’re going to be telling yourself things like; “It’s fallen to far”, “I missed the move”, or “I will short when it bounces”. If you catch yourself saying any of those things, slap yourself for me. Remember what 10banger taught you, be a smart contrarian.

Looking at the market, it’s completely fucked. Once again, I WOULD NOT BET ON A BOUNCE. I suspect we could get a bounce, but betting against the market is not smart. Look for a short term bottom to materialize into a several day bounce. I will be leaving for vacation on Friday, and will be gone till mid December. During that time, I have been barred from looking or talking about the markets. I hope to god I don’t miss anything exciting, however, I’m sure I will.

*Still holding half of my HON short and CMG short.*

UPDATE: I covered the second half of HON at a profit. Fuck it. I’ve decided to hold some of my CMG short over my vacation. It is a small position, and I feel like it. I believe CMG moves lower from here, but due to my vacation do not want to risk a large position getting out of hand. If CMG were to move 50 points, I would only gain/lose %1(after trimming my original position)

Tweet