When it is fairly obvious what needs to be done, investors tend to freeze themselves into glorious inaction. When markets were extremely overvalued, investors tended to resist selling out of even expensive on stocks. They deferred decision making and vacillated on actionables.
When markets fall very swiftly and reach extremely attractive levels, they return to freeze mode turning indecisive and inactive. The opportunity now before every investor is to position themselves differently. It’s a great time to shift away from the overall market mood and to think beyond the immediate. When we do this some obvious factors will clearly grab our attention.
We are now in a buyers market. The buyers set the price. We can invest the quantity we want with very limited impact costs. This is the perfect setting for bottom up stock picking. Such a setting doesn’t come often and is too precious to be wasted. What an investor does now will make a significant material difference to his long term investment outcome.