Cockroach Theory

In finance, the “cockroach theory” is the assumption that any negative news released by a company or other market player only reveals a small part of a much bigger problem with the company or industry as a whole.

The cockroach theory gets its name from the fact that the sighting of a cockroach in a building usually indicates a much larger, hidden cockroach infestation.

More on this topic:
Stocks explained
ETFs explained
Swiss online broker comparison tool

About moneyland.ch

moneyland.ch is Switzerland’s independent online comparison service covering banking, insurance and telecom. More than 70 unbiased comparison tools and calculators are available on moneyland.ch, along with useful financial guides and timely news. The comprehensive comparison tools help you to find the right insurance policies, bank accounts, credit and prepaid cards, loans, mortgages, trading accounts and telecom products for your needs.