Buying stocks when the market drops hard—this is the real way to make big money, trading only 1–2 times a year

In the crypto world and the stock market, every day there are people doing high-frequency trading, chasing pumps and selling into dumps. The result is usually paying fees frequently, “tuition” along the way, and in the end the account gets smaller and smaller. But most people who truly make big money in the long run use a strategy that looks “boring”: when the market drops hard and people panic-sell, buy high-quality assets, then hold for the long term—only 1–2 trades a year.
This isn’t some new theory. It’s a core method that investment masters like Warren Buffett, Charlie Munger, and Peter Lynch have repeatedly verified.
Why is a big drop the best buying opportunity?
1. The price is far below intrinsic value
When the market drops sharply, shares of quality companies are often dragged down by panic sentiment, and valuation metrics like P/E and P/B fall significantly. Buying then is like getting a good company at a “discount price.” Once the market returns to rationality (usually 1–3 years), your gains naturally get realized.
2. Avoiding the risk of chasing after high prices
In a bull market, everyone looks like they’re making money—but most people are the ones left holding the bag at the end. Buying during a drop helps you avoid valuation bubbles, and the margin of safety is higher.
3. Maximizing the power of compounding
Trading only 1–2 times per year means you spend your time and energy researching a company’s fundamentals rather than staring at price charts. Long-term holding lets compounding really kick in: good companies will keep generating profits, paying dividends, and buying back shares—time is on your side.
Real-life examples:
• People who bought Coca-Cola, Berkshire, and other companies during the 2008 financial crisis have achieved several times the return to this day.
• During the 2020 pandemic sell-off, those who heavily positioned in tech stocks or indices doubled in the following two years.
• Bitcoin’s “old-school long-term holders,” who bought at the 2018 and 2022 bear-market lows and have held ever since, have far outperformed high-frequency traders.
How to execute the “trade only 1–2 times per year” strategy?
Step 1: Build a core watchlist
Prepare a list of 10–20 high-quality targets that you truly understand (stocks or crypto assets), including:
• Companies with strong moats (consumer, tech, energy, etc.)
• Persistent competitive advantages, and excellent management
• Financial health and stable cash flow
Step 2: Set buy rules
• The overall market or an individual stock drops 30%–50% or more (combined with macro events like economic downturns or black swans)
• Valuations are in historical bottom-range (P/E, P/B, free cash flow yield, etc.)
• You have sufficient cash position (at least 50%+)
Step 3: Buy in batches + hold long term
Don’t go all-in at once. Buy in 3–5 batches. After buying, delete the app or set it so you don’t monitor the screen. Do a review 1–2 times per year:
• Fundamentals deteriorate → consider selling
• Valuation is far too high → take partial profits
• Otherwise, keep holding
Step 4: Train your mindset
The hardest part is “no action.” The more the market falls, the more you buy—you need very strong contrarian thinking and patience. Remember: time is on the side of good assets.