When quickly skimming the Internet, one notices that there are countless trading signal providers. In fact, for the latter, the aim is often to overwhelm subscribers with advertising and / or sell seminars, books and lectures, as opposed to offering accurate trading signals. We are an owner-operated and therefore independent company. Founder and mastermind – Ara Yalmanian – has been regularly trading based on ONE SIGNAL’s principles for over 15 years.
Since its inception, ONE SIGNAL has outperformed the benchmark index almost every year. Between 2005 and 2020, the S&P 500 returned on average p.a. 7%, compared to One Signal Xpert with 26.5% on average p.a. and One Signal Xpert returning 40.5% on average p.a.
To be a successful investor, some skills such as the ability to evaluate company fundamentals and contextualise geo-political events are required. However, neither of these technical skills is as important as the trader’s mindset.
Contrarian Investing is a widely discussed and often misunderstood approach that, when applied correctly, can bring a lot of success to investors and speculators. To put an end to a myth: “contrarian” does not always mean to be against a trend, or to be permanently against the majority. When a bull market lasts a long time, it’s like standing in the way of a buffalo stampede. Sometimes there are courageous ones who oppose the general opinion.
Throughout hundreds of years of market history, we have observed (financial/asset) bubbles, often with ruinous effects. Asset bubbles have a psychological component. The development is attributed to three psychological factors, which are greed, envy and speculation, whereas three other factors influence the burst of these bubbles: fear, lack of confidence and disappointment.
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In the quest to get rich quickly, capital markets often become very attractive for many individuals. Many newcomers have a success story in mind, in which they have assigned the hero role to themselves. Unfortunately, the reality is different: many individuals leave the stock market with a lot of disappointment after realising big losses. Nevertheless, capital markets remain full of excitement and full of adventure, but above all, they are the best teacher one can find if one is persistent and adaptive enough.
Beginners enter the market greedy for money, success, and recognition. Most people leave the markets disillusioned and with the wrong conclusions, without getting anything in return for their apprenticeship money (losses). The range of the market psychology cycle between euphoria and the emotional apocalypse is the same for everyone. Those who work on themselves in the process can successfully pursue the profession of trader or full-time investor. The vast majority of market participants who are part-time will never be able to fully exploit the market and risk-reward opportunities in their favor. ONE SIGNAL was designed for these people.
This can also be summed up correctly in the words of Warren Buffet: “Buy fear, sell greed.” The majority of value investors believe they are contrarian investors. They seek the intrinsic value in each stock. They buy when the market price is near the intrinsic value (best below it) and sell when the market price exceeds the intrinsic value. Some of them are looking for companies with favorable fundamental data, such as low P/E (price-to-earnings ratio), favorable P/B (price-to-book ratio), or companies with high dividend yields. The purpose is clear: to buy companies that have been neglected by the majority and wait until investors become aware of these stocks. Herd behavior arises when an increasing number of investors use this approach.
So what makes a real contrarian?
What are sentiment indicators?
What sentiment indicators are there?
This table represents the historical highs of various speculation instruments worldwide of a time period of 400 years. It demonstrates very clearly that bear markets always followed historical highs. These downward trends were caused by market participants’ fear of loss, which led them to sell their instruments and therefore cause the bear markets.