It’s not always easy to go against the crowd, especially when it comes to investing. #-ad_banner-#But some of the best investments ever have been made when markets are paralyzed by fear. Warren Buffett is the poster child for this style of contrarian investing. Just look back to 2011 when Buffett’s Berkshire Hathaway invested $5 billion in then-struggling Bank of America (NYSE: BAC). While most investors were fleeing, questioning the bank’s solvency, Buffett saw an opportunity. Today the market value of his investment has more than doubled in just over three years. And when it comes… Read More
It’s not always easy to go against the crowd, especially when it comes to investing. #-ad_banner-#But some of the best investments ever have been made when markets are paralyzed by fear. Warren Buffett is the poster child for this style of contrarian investing. Just look back to 2011 when Buffett’s Berkshire Hathaway invested $5 billion in then-struggling Bank of America (NYSE: BAC). While most investors were fleeing, questioning the bank’s solvency, Buffett saw an opportunity. Today the market value of his investment has more than doubled in just over three years. And when it comes to another one of Buffett’s well-known investments, we have a similar opportunity to profit tremendously today. In the 1960s, American Express made a series of bad loans in a scandal dubbed “The Salad Oil Scandal.” Essentially, American Express was the victim of fraud by a company that obtained loans based on its far-overstated inventory of salad oil. When all was said and done American Express shares dropped more than 50%. Seeing a tremendous value, Buffet stepped in and bought a 5% stake in American Express Co. (NYSE: AXP) for about $20 million. As the years went… Read More