Quote of the day by Warren Buffett on wealth creation: “I will tell you the secret to getting rich on Wall Street…”
Many people assume that building wealth demands complex formulas, insider access or a relentless chase for the next big opportunity. But one of the world’s most successful investors, Warren Buffett, has long argued that the foundation of financial success is surprisingly simple.
Buffetf, who is the chairman and former CEO of the conglomerate Berkshire Hathaway. has consistently advised investors to maintain patience, discipline and a rational decision-making mindset to achieve investment goals. Though these principles sound straightforward, they require uncommon consistency to practice.
In one such advice, the ace investor said, “I will tell you the secret to getting rich on Wall Street. You try to be greedy when others are fearful. And you try to be fearful when others are greedy.”
What does it mean?
The first part of his advice, “Close the doors,” is about creating the right mindset. It means an investor should always cut the noise, such as the constant news updates, the opinions of friends and the hype of the market. The best possible way for a person to make clear and independent decisions is by blocking out the crowd and focus on your own judgment.
When Buffett advised investors to “try to be greedy when others are fearful,” he was pointing to a strategy that can be deployed during periods of market panic.
Prices drop because people are scared and selling. But fear can push stocks below their true value. Buffett’s point is that these moments can create opportunities. If strong companies are temporarily undervalued due to panic, that’s when disciplined investors step in and buy.
He also advised people to “be fearful when others are greedy”.
By that part, he means that when markets are booming, people become overconfident. Prices rise rapidly, sometimes beyond what fundamentals justify. Investors chase trends, ignore risks, and assume prices will keep going up.
Buffett warns that this is when caution is needed. If everyone rushes with the crowd, assets may be overpriced, and a correction could follow. In short, Buffett has advised people to not get carried away in bubbles and give in to herd mentality.
Who is Warren Buffet?
Warren Buffett, alongside his friend and business partner Charlie Munger, was the legendary investor who transformed Berkshire Hathaway into an empire worth billions over a period of nearly 60 years. He is an American investor and philanthropist who is popular for his timely and strategic bets in stock markets.
In January this year, Buffett handed over the reins and CEO position to successor Greg Abel. But his “bull run” with Berkshire has been legendary, delivering returns of more than 55,00,000% over 60 years (1964-2024), building the group to $1.2 trillion and expanding Class A shares to a value of $167 billion.
Famously known as the ‘Oracle of Omaha’ for his timely predictions on stocks, Buffett gained fame and investor confidence for handpicking companies (Apple, Bank of America, Coca-Cola, etc.) that exploded and now account for 70% of Berkshire’s $263 billion stock portfolio. He termed this as “one wonderful business can offset the many mediocre decisions that are inevitable”.
Buffett’s net worth is estimated at $152 billion, making him the 10th richest person in the world, according to the Bloomberg Billionaire Index.