Recently, I saw someone in the trading community discuss Buffett's famous quote: "Be fearful when others are greedy, be greedy when others are fearful." It sounds simple, but very few people actually do it.

I've experienced this dilemma myself. Holding profitable positions, I see price fluctuations and start to panic, fearing that the hard-earned money will be lost again, so I quickly take profits and lock in gains. But then, the market continues to move in the original direction, and looking at the chart, I regret not holding on. Next time, I tell myself I must let profits run and refuse to take profits early, but then the market reverses, and profits gradually diminish, eventually leading to losses. Then I start blaming myself for being too greedy.

This is the real picture for most traders. In stock, futures, and forex markets, you’ll find a common phenomenon: many people keep making the same mistakes. When prices rise to relatively high levels and the market begins to correct, everyone gets stuck—should I exit or hold? If they exit and the price continues to rise, they regret being so fearful; if they don’t exit and the price falls, they blame themselves for being too greedy.

The real issue isn’t whether you are greedy or not, but that you lack rules. I’ve observed many unsuccessful traders, and they usually share a few common traits: taking profits quickly, rushing to close losing positions; or the opposite, stubbornly holding onto losing trades, hoping for a reversal; or having no plan at all—chasing uptrends and selling on dips, operating without discipline and overleveraging. These approaches might occasionally make money, but mostly it’s luck. The final result is often a big loss that wipes out all previous gains.

What sets true experts apart from these people? They have a complete trading system. Entry rules, exit rules, money management rules—most importantly, they strictly follow these rules. What’s the benefit of doing so? It means you no longer need to judge when others are fearful or greedy because your system has already made the decision for you. You just need to cut losses short, let profits run, and execute according to your plan.

Ultimately, this isn’t a technical issue but a psychological one. Human nature hasn’t changed much over thousands of years—greed and fear are still instinctual. But individuals can evolve. Successful traders are those who continuously practice and reflect, gradually overcoming their inner demons, and eventually becoming market winners. Most people, however, remain trapped in this cycle forever.

So my advice is: instead of obsessing over when to be greedy or fearful, spend time building your own trading system. Within a familiar and controllable scope, replace emotions with rules, replace intuition with plans. Only then can you truly understand the essence of Buffett’s words, rather than just hearing them.