How is it possible that so few people will make money on a major move? There is no doubt that only a few investors, if any, can capitalize on a crisis because they keep their emotions in check and therefore can make this hard choice. As we have seen time after time, the most profitable trades are the toughest emotionally to execute.

Since most investors don’t have the emotional strength to buy into weakness, they all crowd in after a trend reversal has been confirmed and thereby end up repeatedly overpaying. The market will always reward the few who have the stomach to be behind after they buy, and then to be even more behind after they buy more. The harder the trade, the more profitable it will be.

At present, we reckon that the value is in raw material and precious metals, as well as emerging markets (EWZ, EEM), albeit to a lesser extent. Although the timing is uncertain and investment in precious metals is highly volatile, if you can hold a long-term view we believe the precious metal ETFs offer the potential for outsized returns.

The key missing ingredient in the rally for commodity ETFs has been the incentive for investors to need alternatives to their dividend paying favorite ETFs. Now that yield funds have been underperforming for the past several weeks, an increasing number of momentum players, institutional traders, and eventually amateurs will look to buy whatever is most likely to be able to sustain a dramatic high-percentage rally.

However the media have created an environment of fearful emotion for precious metals and commodities in general. To make a point, we would like to share some recent notable media coverage. These provide evidence that we are choosing to do the opposite and why we are doing so.

Gold under $1,000 an ounce. Don’t rule it out says Goldman Sachs.

In 2008, Goldman Sachs was touting its so called safe mortgage-backed securities to pension funds around the world, while simultaneously selling them short. Earlier in 2013, as Goldman issued a strong sell recommendation on gold, they made an all-time record purchase of the yellow metal.

Roubini bearish on gold, but optimistic about U.S. and Japanese stocks.

Three big trends to replace the BRICS.

At each important short-term bottom for gold and mining shares the mainstream financial media will stream nonstop negative stories and often irrationally low price targets. That is, until gold achieves a new 12 month high. Then the story will change.

When trading financial securities (with the exception of a handful of experts) most people set aside all logic and rely on a short-term horizon. For all assets, the financial markets will repeatedly punish those who try to catch each wave, which is the strongest emotional tendency, while rewarding those who make the most difficult psychological moves such as buying into extended weakness and selling into extended strength.