As the stock market moves down, I’m taking the Warren Buffett approach!

It has been a troubling few weeks in stock markets on both side of the pond, with both the FTSE 100 and S&P 500 well below the highs they set earlier in 2026. Volatile markets can offer opportunity for investors who are willing to see them the right way and act accordingly. One such investor is Warren Buffett, who has lived through plenty of bear markets in his decades of stock market investing.

In fact I think that learning from Buffett’s approach can be very helpful at a time like now, when looking to build wealth.

To begin, forget about the stock market altogether. Instead, think about a business you know and understand. Warren Buffett always tries to stick to businesses he understands.

Ask yourself what chance that business has to succeed over the long term.

How big is its target market, what competitive advantages does it have – and are they likely to endure?

Then consider its economic model. Sometimes a big business with massive sales can still lose money, so understanding a business model matters.

That process is how Buffett determines whether a firm is the sort of great business he would like to own.

But Buffett does not just talk about great businesses. He talks about buying into great businesses at attractive prices.

That is a crucial distinction. Even a brilliant business can make a lousy investment if someone pays too much for their stake in it.

Turbulent markets generally do not alarm the Oracle of Omaha. If the underlying value of a business whose shares he owns as a long-term investor remains the same, he does not care if the stock market values them lower during a period of volatility.

But such periods – like the one we are in now – can offer the savvy long-term investor an opportunity, if they enable them to buy into a great business for an unusually attractive price.

As an example, one share I think investors should consider is homewares retailer Dunelm (LSE: DNLM).

The Dunelm share price has crashed 29% since the start of the year. That means it now sells for just 11 times earnings, while offering a dividend yield of 5.7%.

In fact, although payouts are never guaranteed, the prospective yield over the medium- to long-term could be higher, as Dunelm often uses surplus cash to fund special dividends.

Why the share price fall?

Weak consumer confidence and an uncertain outlook for the property market threaten to eat into demand for homewares. Higher logistics costs due to soaring oil prices could make imports costlier for Dunelm, eating into profits. Last month the company told investors that, “the consumer environment remains challenging, with variable trading patterns”.