Recently, I've been pondering a question. Buffett's famous quote, "Be fearful when others are greedy, be greedy when others are fearful," sounds simple, but in practice, it's incredibly difficult to execute.

I've personally experienced this dilemma. Sometimes, after a trade makes a profit, I start to fear the profits will shrink, so I hurriedly take profits and lock in gains. But then the market turns around and surges again, and that feeling of missing out is really uncomfortable. On another occasion, I stubbornly held my position, hoping to let the profits run further, only to see the market reverse and wipe out all the gains overnight. Afterwards, I regret being so greedy.

This is the most common dilemma in trading. When the market rises from a low point into profit territory and begins to correct, you simply don't know whether to exit or hold. Exit, because you're worried there might be more upside; hold, because you're afraid of losses expanding. Looking back, it all seems obvious, but in the heat of the moment, your mindset is tense, and rational judgment becomes difficult.

I've noticed that many retail traders and beginners tend to exhibit four typical failure patterns. The first is taking profits quickly when in profit and cutting losses early—pure fear-driven behavior. The second, worse, is adding to losing positions in hopes of a reversal, holding onto a lucky hope that the market will turn around, which often results in even bigger losses. The third is blindly following the crowd—chasing rallies when others buy, selling when others sell—completely lacking their own trading logic. The fourth is going all-in with heavy positions, which is purely driven by greed.

These four behaviors may look different on the surface, but fundamentally, they are all human weaknesses messing things up. The first two stem from fear, the latter two from greed. Sometimes, if you're lucky, you might make a few successful trades by acting impulsively, but that's just luck. Sooner or later, a big loss will bring you back to reality.

So, how do the true experts operate? They have a complete trading system that follows the logic of "cut losses short and let profits run." They have rules for entering and exiting trades, rules for capital management, and most importantly, they strictly adhere to these rules. They are not driven by blind greed or fear; instead, their greed and fear are based on rational judgment within a system and set of rules.

Interestingly, despite material wealth increasing from agricultural civilization to the industrial age and now the information era, one thing hasn't changed for thousands of years: human nature. Fear and greed are embedded in our DNA, repeating generation after generation.

But this doesn't mean human nature is unchangeable. Professional traders, through long-term practice and reflection, gradually conquer their own fears and greed, ultimately becoming market winners. Most investors, however, remain trapped in the cage of human nature, repeating the same mistakes over and over.

Therefore, my current advice is: first, respect the market and view its state rationally. Second, systematically work to overcome your human weaknesses, continuously improving your trading understanding within a familiar and controllable scope. Sometimes, we can also think in reverse—using analytical tools to observe the general psychological state of market participants, which can help us reduce market risks. When others panic, that's our opportunity to be truly greedy—provided we have discipline, systems, and rules in place.