One surprise about the stock market is that, often, it doesn’t move in a rational or logical way. As a result, people who succeed in other walks of life through a logical approach to business are perplexed that they are unable to do as well in the stock market by using similar methods.

My contention is that if you are trying to predict the mass action of thousands of investors, most of whom are investing on a rational or logical basis, you won’t be able to do this by taking the same logical approach as everyone else. The only exception is if you have an ability, through crystal ball or otherwise, to predict the future more accurately, or faster, than others. Unsurprisingly, this is something that very few can achieve. Thus, the market often moves to make the majority wrong and, in doing so, does the unexpected. For example, if everyone is positioned for the market to rise, it means that these bullish expectations are probably already discounted.

The market is an efficient discounter of the future and so, at turning points especially, the correct view is, by definition, the minority view.

As the stock market can’t be predicted by logic alone, I believe investors have to use two conflicting approaches. First, they need their own views of the correct value to be placed on a company, worked out through fundamental analysis and by making predictions about future prospects etc. But investors also need to listen to what the market is telling them and see what they can learn from the behaviour of other investors. It is one of the reasons why I use technical analysis to complement my fundamental analysis; technical analysis is good at showing the mass action of investors. It is also why I put such emphasis on sentiment indicators, particularly when they are at as extreme a level as they were earlier this year. If these indicate that most investors have voted one way, it nearly always pays to bet against them.

The stock market, certainly over the shorter term, is more of a voting machine than a weighing machine. This combination of having one’s own view, but also listening to the market, is at the heart of my investment approach.

When I became optimistic about markets in the last quarter of 2008 and the first quarter of 2009, I received a huge amount of push-back from the audiences that I spoke to. Didn’t I understand that the economic outlook was dire and possibly the worst for a generation, they asked me?

The biggest problem they had was that I couldn’t give them persuasive economic reasons to explain why I saw a more rosy future than the negative consensus would have them believe to be true. That is because I believe it is very difficult to predict turning points solely using rational economic arguments.

Instead, my views were based on the three main inputs I have consistently looked at throughout my career. I considered the length and depth of the bear market relative to other historical bear markets, valuation levels versus their long-term history, and sentiment measures. Only the bear market of the Great Depression had proved deeper – the market p/e was lower than it had been since the 1970s and consumers were more negative than they had been in a long time. Equity mutual funds were still seeing large redemptions and hedge fund gross exposure to the market was at a low point.

What is my view today? Unlike earlier this year, I do not have a very strong view. My three main inputs are not aligned in the way they were at that time. I believe a low-growth, low interest rate environment in the western world will be good for most assets. This includes equities and companies that can show above-average growth. If a company can show decent growth in this low-growth environment, I think valuations could move upwards quite significantly. I also think this bull market will be quite front-end loaded (because of how negative sentiment had become at the low), after which we may need a protracted period of consolidation before further progress.

A key question is whether low growth in the developed world will lead to a bigger differential between developed and emerging markets than has been the case historically. Most investors have the majority of their assets in developed markets and a minority in emerging markets. Maybe for the next few years this will prove to be the wrong way round.

Anthony Bolton is president of investment at Fidelity International. Under his management, the Fidelity Special Situations fund was the top performer in its sector from its launch in 1979 until he stepped down in 2007.