We've seen time… and time… and time again just how large a part human emotion plays in big market moves.
Whether it's classic Greenspan-ian "irrational exuberance" at market tops, bidding up everything from tulip bulbs to dot-com stocks, or – less so these days – despair that catches like wildfire, sending otherwise perfectly sound stocks plummeting with no business case for them to do so.
In other words, emotions drive financial markets (and, importantly, the individual securities on them) "out of whack" – sometimes severely so.
This emotion drives investors to make bad, if not disastrous, decisions, gleefully overpaying at tops and selling at a long-term loss at bottoms.
Nevertheless, if you can hold your nerve, keep a proper perspective, and not go along with the crowd, you'll find that there's massive upside in these extreme situations – especially the one I'm going to show you.
Now, these aren't just rare opportunities. You can find these extremes everywhere in the market, at just about any time.
They show up in broad indexes… specific market sectors… individual stocks and bonds…