How Accurate Is Sentiment? by William Lansburg
ARTICLE SYNOPSIS ...How Accurate Is Sentiment?
by William Lansburg
Of all the tools that technicians use in trying to predict the future of the stock market, one of the most
common is the sentiment index. Basically, the theory behind the sentiment index holds that it is best to be
a contrarian. The theory states that whenever a high percentage of investment advisors are bullish, the
market should decline, and when a high percentage of investment advisors are bearish, the market should
move up. Some say ""the high percentage"" should be 60%, while others argue it should be lower, at 55%.
Let's examine the sentim...