Taking the other side Michel Pireu     | Business Day Wednesday, January 30, 2019
"The crowd always loses because the crowd is always wrong. It is wrong because it behaves normally," said Fred C Kelly in a book titled Why You Win or Lose: the Psychology of Speculation, written in 1930. Kelly's key to success, in his estimation, largely turned on his ability to not do what everyone else was doing. In other words, he didn't follow the crowd. But it isn’t an easy thing to do he says. “If you think it is easy to do invariably the opposite of what seems to be the sensible thing that everybody else is doing just try it. At every step, one is tempted to do that which seems logical, but which is nevertheless unwise.”

Humphrey B. Neill, a contemporary of Kelly’s, agreed with him and shortly after the 1929 crash wrote: “In as much as it is impossible to accurately time the reactions of the crowd, it is advantageous to consider the opposite of what appears probable. The crowd has been so wrong so frequently in their opinions ... that it is imperative to look on the unsuspected side of all questions and all predictions… Obvious thinking – or thinking the same way in which everyone else is thinking – commonly leads to wrong judgments and wrong conclusions… if you wish to keep from guessing wrong, learn to think contrarily.” Nor did he think it was easy. “Sameness of thinking is a natural attribute,” he wrote. “You need to learn to throw your mind into directions which are opposite to the obvious.”

“I believe,” concluded Neill, “that it is a matter of getting into the habit of looking on both sides of all questions and then determining from your two-sided thinking which is the more likely to be the correct version in order to avoid being entrapped.”
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