Legendary investor Warren Buffett is known for many things, including memorable quotes. Perhaps the most cited is his contrarian philosophy: investors should “be fearful when others are greedy and to be greedy only when others are fearful.” Of course, the problem with this sentiment is that it’s not clear which ideas are worth taking a risk on and which ones should be left in the garbage bin.
After all, if every security that encountered a bout of red ink was a good opportunity, then there would be no bear markets — and by default, no business implosions. Clearly, that is not the case.
