James Klempster: Current market sentiment versus investor behaviour

Investment managers know only too well the importance of trying to distance themselves from broader market sentiment. Benjamin Graham introduced the notional ‘Mr Market' in his book The Intelligent Investor to represent the actions of market participants in aggregate. The behaviour of Mr Market is, at heart, driven by collective sentiment.  Graham himself was fairly scathing of Mr Market, noting that "…you should do business with [Mr Market] but only to the extent that it serves your interest". Warren Buffet, Graham's protégé-turned-market master elucidated: "Mr. Market is kind of a drun...