The art of contrarian trading: how to profit from crowd behavior in the financial markets

The Art of Contrarian Trading provides techniques to identify and capitalize in situations where the market is substantially overvalued or undervalued because of the influence of crowd behavior. Written by leading investment blogger Carl Futia, the book will meticulously develop the concept of how markets are driven by crowd behavior within the context of the efficient market theory. Heexplains that typically investors become more bearish as prices decline and more bullish as prices rise. As trends continue, investors tend to become more emotional and accepting of existing market analysis. Finally, at market tops, investment sentiment is largely bullish and at market bottoms, sentiment is largely bearish. Futia provides tools to remain objective; measure the behavior of crowds; and to spot those situations where its time to take a position against the crowd. The difficulty with this kind of approach is that it is as muchart as science. There are technical indicators and other types of quantitative information that can be used to monitor crowd behavior in the markets. But Futia believes its just as important to read headlines in the news media to determine when a market sentiment has gotten far out of hand. Indeed, as Futia relates, major market turning points are almost always foreshadowed by magazine covers and newspaper headlines that turn out to be astonishingly and completely wrong. By monitoring crowd behavior through both quantitative indicators andnews media headlines and with the hindsight of historical examples a trader or investor will be well-equipped to profit from market turning points.

• ISBN: 978-0-470-32507-0
• Editorial: John Wiley & Sons
• Encuadernacion: Cartoné
• Páginas: 226
• Fecha Publicación: 15/07/2009
• Nº Volúmenes: 1
• Idioma: Inglés