contrarian

play

noun con·trar·i·an \kən-ˈtrer-ē-ən, kän-\

Updated on: 26 Jul 2017

Definition of contrarian

: a person who takes a contrary position or attitude; specifically : an investor who buys shares of stock when most others are selling and sells when others are buying

contrarian

adjective

contrarianism

play \kən-ˈtrer-ē-ə-ˌniz-əm, kän-\ noun

See contrarian defined for English-language learners

Examples of contrarian in a Sentence

As an investor, he's a contrarian, preferring to buy stocks when most people are selling.

Recent Examples of contrarian from the Web

A statistically representative debate on climate science would feature 97 mainstream scientists debating three contrarians.

— emily atkin, New Republic, "Scott Pruitt wants scientists to debate climate change on TV. He clearly doesn’t watch cable news.," 11 July 2017
That has some contrarians worried about what will happen when central banks move away from stimulus.

— stan choe, The Seattle Times, "This is peak investing: Stocks, bonds and concerns are up," 17 June 2017
That has some contrarians worried about what will happen as the Federal Reserve continues raising interest rates and talks about paring back its bond investments.

— stan choe, The Seattle Times, "This is peak investing: Stocks, bonds and concerns are up," 15 June 2017
The extent to which Ivanka and Jared have carefully cultivated their positions as White House contrarians has been a marvel to behold.

— philip bump, Washington Post, "Imagine any other Trump adviser appearing on a magazine with this headline," 7 June 2017
The role of defender of the Luddites likely would have appealed to Byron, whose signature character type was the Byronic hero—a passionate contrarian who fought against the prevailing beliefs of society.

— kat eschner, Smithsonian, "Byron Was One of the Few Prominent Defenders of the Luddites," 27 Feb. 2017
Matt, Jake, and I are fellow contrarians who relish a certain kind of archaic and analogue craftsmanship.

— david coggins, Condé Nast Traveler, "Men on a Mission: A Hunt for Whisky and Tweed in Scotland," 24 Feb. 2017
But the past 12 months have silenced any and all contrarians.

— mark whicker, Orange County Register, "Whicker: Why mess with sports after such classic championships?," 13 Feb. 2017
As Jeff Bezos said of you in October, contrarians are usually wrong.

— maureen dowd, New York Times, "Confirm or Deny: Peter Thiel," 11 Jan. 2017

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'contrarian.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Did You Know?

Anyone who thinks that most of what the public believes is wrong would be called a contrarian. And contrarian is a basic term in the vocabulary of investing. In fact, most successful investors often behave like contrarians by "buying low and selling high"—that is, buying stocks that are cheap because most investors put a low value on them but that have the possibility of rising, and selling stocks that most investors are valuing highly but that seem likely to decline. The word may be most common as an adjective; so you may express a contrarian opinion, hold a contrarian view, or pursue a contrarian investment strategy.

Origin and Etymology of contrarian

see ¹contrary

NEW! Time Traveler

First Known Use: 1954

See Words from the same year

Other Economics Terms

actuary, compound interest, globalization, indemnity, portfolio, rentier, stagflation, usurer

Financial Definition of CONTRARIAN

contrarian

noun

What It Is

A contrarian is an investor that attempts to profit by deviating from conventional wisdom or "the herd."

How It Works

Generally, the basic premise behind contrarian investment methods is that the market or "crowd" tends to overreact to information in the short-term, which causes price increases and decreases to be overdone and allows savvy investors to profit.

Contrarians zig when everyone else zags. They tend to buy when everyone else is selling, sell when everyone else is buying. The result is that the contrarian often buys a cheap security that everyone else is calling a dog and sells a security that everyone else is clamoring to get into. Contrarians often look for stocks with low price-to-earnings ratios. In fact, there is little difference between value investing and many forms contrarian investing.

The Dogs of the Dow popular contrarian strategy whereby investors purchase the highest-yielding stocks in the Dow Jones Industrial Average (DJIA). Remember, a stock has to pay a relatively high dividend and have a relatively depressed stock price to have a high dividend yield. When any of the investor's stocks rise in price so much that they are no longer in the top ten, he/she sells them, capturing the gain.

Why It Matters

It is important to note that contrarian investing often works best for investors who have thoroughly analyzed the fundamentals of the companies they invest in. Companies with solid management teams, innovative products, efficient processes, and good profit margins can often weather periods of unpopularity.

Source: Investing Answers