'Just crazy': Buffett warns those urging you to chase the market are 'selling something.' How to invest like the Oracle

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Legendary investor Warren Buffett has a blunt message for anyone trying to time the market: don't.

"I always want to have cash, and I never want to buy anything just because people think the market is going up," Buffett said in a recent CNBC interview (1). "The idea that people think they know what the market's going to do is just crazy."

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For years, the Oracle of Omaha has practiced what he preached. Although no longer the CEO of Berkshire Hathaway, Buffett still acts as chair of the company, and Berkshire reported cash and U.S. Treasury holdings of $370B in their most recent annual report (2).

But Buffett didn't stop at discussing cash. He also took aim at market forecasters.

He noted that, to him, it seems absurd for an investor to widely distribute genuine forward-looking investment advice to the public. Buffett compared it to "finding gold in their backyard" then going on television to broadcast the dig, concluding that they must be "selling something."

The advice comes at a time when investors are grappling with market volatility and mixed signals from the economy. There's also no shortage of dubious online personalities telling you what stocks to buy and when.

After all, no one can predict where the market goes next, so what is the savvy investor to do?

Buffett's famous for cutting against the common instinct to chase momentum.

Perhaps his most famous, oft-quoted piece of advice comes from his 1986 letter to shareholders: "Our goal is more modest: we simply attempt to be fearful when others are greedy and to be greedy only when others are fearful" (3).

When markets rise — or rather, when headlines suggest they might — investors feel that kneejerk reaction to jump in (or out) and avoid losing out. But Buffett's philosophy with investing is rooted in discipline, patience and skepticism toward short-term predictions.

Buffett's main point is that one can reliably predict short-term market movements. Not when a stray Truth Social post from the President can swing the market by 5%, according to JPMorgan portfolio manager Bill Eigen (4).

And without any inside knowledge as to what's going to happen next, there's no way to act on the hype in a way that reliably wins. So holding onto your cash or sticking to your normal investing routine is often the better strategy.

The former can be especially important over time. Keeping cash on hand gives investors some optionality to act when real opportunities arise, not just when a trend hits the markets.

Studies such as the Dalbar Inc. Quantitative Analysis of Investor Behavior have repeatedly found that the average investor underperforms the S&P 500 by around 848 basis points (8.48%), largely due to emotional decision-making (5).

In other words, the real risk isn't market volatility but how you respond to it.

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Since timing the market is "crazy," per Buffett, investors who don't want to monitor markets constantly can help themselves by removing emotionality from the equation entirely and moving to automatic investments.

The beauty of ETF investing is its accessibility — anyone, regardless of wealth, can take advantage of it. Even small, consistent contributions can grow over time without needing to predict where markets are headed.

For example, if you invested just $5 a day, that's around $150 a month. Assuming a 7% average annual return, it can grow to $18,000 in 8 years, or over $75,000 in 20 years.

Tools like Acorns are built around that idea. The app automatically invests your spare change by rounding up everyday purchases into the nearest dollar and putting the difference into a diversified portfolio.

Getting started takes just minutes: Link your cards, and Acorns handles the rest, keeping the pressure off your shoulders.

You can get started with Acorns here and begin investing with as little as $5. Plus, if you set up a small recurring investment, Acorns will add a $20 bonus to kickstart your portfolio.

Even disciplined investors can get spooked and make emotional decisions, such as selling too early, chasing hype or trying to time the next move. But that's where the biggest losses can happen.

A financial advisor can help you step back, crunch the numbers, and stick to a plan that works.

That's where Advisor.com comes in. The platform connects you with a vetted financial advisor for free, taking the work out of trying to find someone you can trust.

Advisor.com does the heavy lifting for you by screening advisors based on track record, client ratios, and regulatory history. It's a network of fiduciaries, meaning they're legally required to act in your best interests.

Just answer a few questions about your finances and goals, and Advisor.com's AI-powered matching tool will set you up with an advisor suited to your needs.

You can set up a free initial consultation with no obligation to move forward. Because when markets get unpredictable, having someone in your corner can make all the difference.

If you're a more hands-on investor and prefer to take on the markets yourself, regardless of what Buffett says, you're going to need to do a bit of homework.

Instead of chasing headlines or market noise, Moby provides research and recommendations backed by former hedge fund analysts. This can help you stay focused on long-term opportunities grounded in fundamentals and your financial goals.

In four years, and across almost 400 stock picks, their recommendations have beaten the S&P 500 by almost 12% on average. They also offer a 30-day money-back guarantee.

Moby's team spends hundreds of hours sifting through financial news and data to provide you with stock and crypto reports delivered straight to you. Their research keeps you up-to-the-minute on market shifts and can help you reduce the guesswork behind choosing stocks and ETFs.

Plus, their reports are easy to understand for beginners, so that you can become a smarter investor in just five minutes.

One smart strategy investors often employ is hedging. The idea goes that by diversifying your portfolio across sectors and asset types, you reduce your overall risk. To flip a common expression on its head, a well-diversified portfolio can help stop a receding tide from punching holes in your fleet.

When it comes to hedges, a common safe-haven bet is gold. The precious yellow metal can't be printed at will by central banks, unlike fiat currencies like the U.S. dollar. It can also preserve more of its value during a downturn than stocks and bonds.

Although Buffett has long been skeptical of gold as an investment, arguing that it doesn't produce income (6), that hasn't stopped it from being a popular investment for many.

If you're curious about adding precious metals to your broader inflation-hedging strategy, a gold IRA from Goldco lets you hold physical gold and other metals while still getting the tax advantages of an IRA.

Goldco is one of the leading companies in the space, with a 4.8/5 rating on Trustpilot and an A+ from the Better Business Bureau. They also offer a guaranteed buyback program, meaning they'll repurchase your metals at the "highest price" according to market value if you ever decide to sell.

If you want to explore whether precious metals could be a helpful hedge for your portfolio, you can download Goldco's free gold & silver guide to see if it's a good fit for you.

Even better, qualifying purchases can receive up to 10% in gold or silver to boost your initial investment.

Even if it's not Buffett's preferred asset, diversification can still play a role when markets feel unpredictable.

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CNBC (1); Berkshire Hathaway (2), (3); Fortune (4); Dalbar (5); Investopedia (6)

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.