your pain=my gain
Today was fun! I took your money!
You were out fear selling, I was buying! Nice turnaround!
It's easy, You're Backwards!
When 90% of people are long something, the only thing that can push it higher is if 10% of the capital goes into that thing. That provides 10% upside and 90% downside. Although in practical terms when assets get too neglected there are obvious opportunities to use that cash to immediately get more cash back. For instance, lets say a profitable company was selling at under the amount of cash it has on the books and it earns enough money to pay for any debt obligations it has. Anyone with enough money to take over this company buys the company outright, sells off enough of its asssets and returns the value to shareholders, or returns them directly, and then owns the rest of the company for free. There are so many securities out there, that there's a practical limit to how much any amount of capital can move without creating irrational levels of opportunity. You'll never make any significant money following any variable in isolation or following the herd and we're all geared...
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