Recently, maybe because of the market downturn, I keep hearing people say that opportunities lie within crisis. Well, you know, the Chinese equivalent of it, weiji. It’s either that, or it’s Warren Buffett’s be greedy when others are fearful.
Whoever taking these words of wisdom at face value is crazy. As with all other such aphorisms, the context matters. A lot. Applying these condensed advice to all context is insane. Usually I see people applying them to whatever situations they are in to justify, to rationalise and to convince.
I think if your only reason to buy a stock is because there is fear in the air or there is danger everywhere, you had better buck up. If anything, that is just a starting point to investigate, to probe, to find out. It cannot be the sole reason to buy. In trying to become a contrarian and go against the crowd, you