Contrarian Thinking explained
Going against the herd is the key principle of Value investment. This is where it differs from the chartists etc who essentially try to “go with the flow”. Going with the flow is great while swimming. Contrarian thinking is not based on ignoring known facts or just trying to be different / brave. It essentially means stripping out the emotions from the current situation and looking at things in black and white. Explaining with a demo: Let me make this clear with an example. I am sure “3 idiots” a popular bollywood flick, was enjoyed by one and all (including me). Most of us will also swear by the “message” of the movie. But on a slightly deeper analysis, the movie shows big fallacies and inconsistencies in its events and incidents. I will take one: a student commits suicide since the heartless professor didn’t allow him extra time/credits for project submission. CONSENSUS view: Poor student had to die because of the arrogant SOB Virus (nickname of the teacher). D