Warren Buffett's phrase "buy when everyone is selling and sell when everyone is buying" is one of the most iconic in the world of investing, and is based on the concept of contrarian investing. This philosophy suggests that the best times to buy are when the market is depressed and prices are low (due to widespread fear and panic), and the best times to sell are when the market is euphoric and prices are high (due to excessive optimism).

Why is it so used and what is it based on?

#marketpsychology: Buffett's phrase takes advantage of the cyclical nature of markets and mass psychology. Investors tend to be carried away by emotions, buying when there is optimism and selling when there is fear. This creates opportunities for contrarian investors who can keep a cool head and act rationally.

Intrinsic value: Buffett is a proponent of value investing, which involves buying companies that are trading below their intrinsic value (what they are really worth). When the market falls, shares of good companies can be available at bargain prices.

Proven track record: #Buffett 's own investment strategy has demonstrated the success of this approach over time. He has amassed a huge fortune by buying undervalued companies during crises and holding them for the long term.

Simplicity and power: The phrase is simple but powerful, encapsulating a complex investment strategy in a few words. It is easy to remember and understand, making it attractive to investors of all levels.

Not a Guarantee: Contrarian investing is not a magic get-rich-quick formula. It requires discipline, patience and the ability to go against the grain.

Fundamental analysis: Contrarian investing does not mean buying anything when the market falls. It is crucial to perform solid fundamental analysis to identify companies with good fundamentals and long-term growth potential.