Warren Buffett’s criteria for selecting a successor have little to do with IQ or EQ. Instead, they hinge on temperament—specifically, the ability to remain emotionally grounded.
Why? Because investing isn’t about outsmarting others. It relies on common sense and adherence to timeless principles. Ironically, excessive cleverness can backfire. Those who overcomplicate strategies often dismiss straightforward paths, assuming such routes are for the “average” investor.
Public markets, unlike many industries, are a rare meritocracy. While connections and social savvy dominate careers elsewhere, they hold little sway here. There are no gatekeepers or “untouchable titans” in this arena. Flashy networking or political maneuvering might generate short-term buzz, but without genuine skill, they’re as fleeting as pre-race hype in a marathon. What ultimately matters is the ability to run.
Why Emotional Stability Wins
The “Mr. Market” metaphor—coined by Benjamin Graham—aptly captures the market’s manic nature. It tempts investors to buy high and sell low, exploiting fear and greed. Those who thrive cultivate emotional resilience: staying composed during volatility, trusting their rational analysis, and executing plans methodically. This discipline isn’t just a professional edge—it’s a lifestyle imperative. After all, sustained success requires avoiding burnout.
Practical Steps to Stay Grounded
Physical distance works. Guy Spier (author of The Education of a Value Investor) relocated from New York to Switzerland after his lunch with Buffett, insulating himself from Wall Street’s noise. Humans aren’t machines; emotional fluctuations are inevitable.
For those tethered to institutional environments, here’s actionable advice:
- Embrace analog rituals. Reading physical books fosters focus and calm, counteracting digital chaos.
- Prune your digital ecosystem. Most “connections” add zero alpha. Exit non-essential chat groups (think: WeChat clusters) and mute noise. Missing a viral meme won’t sink your portfolio.
- Walk away from the herd. If you can’t think clearly amid frenzy, step outside. Sometimes, doing nothing (a “neutral” act) beats making impulsive moves (a “negative” one).
In investing, as in life, stillness is a superpower. Cultivate it.
