Commodity Prices

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This entry was written by one of our contributers and submitted to our resource section. The author's views below are entirely his or her own and may not reflect the views of Energy Saving Trust

Be A Rebel: Contrarian Investing

Buying stock on a hunch that it may go up when all indicators are that the particular stock of interest is destined for a down turn is known as contrarian trading. While this particular type of trading is incredibly risky it can also provide astonishing payoffs to savvy investors. The truth of the matter is that most people in a position to provide trading advise are the very ones listening to the same advice they are providing to you. They do not, for the most part, formulate their own opinions, theories, or hypothesis but rather follow the very same market trends and prediction models that most of the other advisors and brokers are using as well.

If you wish to be successful when it comes to contrarian investing you must first learn to think well outside the box. By learning where the vast majority of traders (by this I mean 80-90% of investors not a mere 60 or so percent) keep their money and by then keeping an eye on the market for indicators to buy elsewhere you can seriously increase your personal wealth by going against the flow.

One important thing to keep in mind with this particular sort of investment strategy is that it is a high-risk type of investment. Chances are that you will be wrong on occasion when taking the road less traveled. In fact, the chances are that you will be wrong more often than not. With this particular style of trading one must trade quickly and work to keep losses minimal rather than sitting and waiting in order to avoid losses along the way.

With this in mind it is very important that you always have an exit strategy when utilizing contrarian trading. For this particular type of trading you must have a strategy in place to get out quickly if things turn south and protect as much of your investment as possible during the process. It is also a good time to consider buying when most people are bailing, wailing, and gnashing teeth at their brokers.

Another thing to keep in mind is that sometimes the best commodity to hold is cash. There have been times in the past when pulling out of the market for a year or two would have served the average buyer much better than trying to weather the storms that have risen and receded along the way. If you find nothing that is appealing to you for investment consider a money market account until something comes along to strike your fancy. Some of the best deals at any point in history have been made on hunches or simple interest.

The important thing to remember when investing is that if you do what everyone else is doing, you will get the same results that everyone else is getting. If you step outside the box and do something fantastic or different, chances are that you will experience fantastic results for your efforts.Want to become a better investor or trader? Learn more aboutFinancial Advisorandinvesting in bonds. Start making more money today.

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Commodity Prices

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What are commodities, and what do commodity prices tell us?

Frequently Asked Questions...

What is the US Market outlook next week Oct 22-Oct27 2007 and the rest of Q4 2007?

What is the prediction on the oil price? And Commodity price such as gold? By the way, I live in Indonesia, will the Indonesian's Stock prices be affected by the uprising of oil price?


Best Answer...

Answer:

As long as the US dollar goes down oil should be cheaper for you but you will lose out on sales to the US.

The next few months may prove to be the craziest marketwise for decades. There's a lot brewing economically and politically between nations. At times it feels as if we are at a new cold war. Some countries are talking of dropping dollars as their currency of choice for transactions. This would hurt the dollar even more.

Bush has been quite quiet lately. I bet we are going to see new terrorist attacks this fall - november or december - which will cause more turmoil. In addition there is always the Iran situation.

Finally there are a lot of people in denial or talking down the situation to improve it. Wait and see if these people will take responsibility for their words.

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