The stock market officially dipped into a correction recently, with the S&P 500 dropping more than 10% from its highs. Perhaps no investor has done quite as good of a job capitalizing on market corrections and crashes than Warren Buffett, so let's take a step back and see what we can learn from his experience.

Here's some of the best Buffett wisdom from his financial crisis-era 2008 and 2009 letters to Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) shareholders, as well as some more recent Buffett quotes that can help you see market corrections for what they really are, and use them to your advantage.

Corrections are normal and unpredictable

In recent years, the stock market has essentially gone straight up. This is especially true in the time since the 2016 election. As a result, many investors simply aren't used to seeing big market drops anymore. Additionally, since major market indices such as the Dow Jones Industrial Average are significantly higher than they were during previous corrections, the numerical point drops sound much scarier.

However, it's important to point out that not only are corrections inevitable and unpredictable, but they are part of a normal market. Buffett said in his most recent letter to Berkshire Hathaway shareholders, "The years ahead will occasionally deliver major market declines -- even panics -- that will affect virtually all stocks. No one can tell you when these traumas will occur."

A correction is like a sale in the stock market

In 2008, the U.S. financial system appeared to be on the brink of collapse, and few stocks were immune from the carnage. And while it performed slightly better than the overall market, Berkshire was no exception, down more than 30% for the year. What's more, Berkshire's book value actually went down during 2008 for only the second time in Buffett's tenure.

A big part of the decline in book value was poor performance in the company's massive stock portfolio. In his letter to shareholders detailing Berkshire's 2008 performance, Buffett addressed the decline in Berkshire's stock and bond investments:

This does not bother Charlie [Munger] and me. Indeed, we enjoy such price declines if we have funds available for increase our positions. Long ago, Ben Graham taught me that 'Price is what you pay; value is what you get.' Whether we're talking about socks or stocks, I like buying quality merchandise when it is marked down.

Don't follow the crowd

In Buffett's 2008 letter, he also said "Beware the investment activity that produces applause; the great moves are usually greeted by yawns." The next year, in his 2009 letter, Buffett said to his investors:

It's been an ideal period for investors: A climate of fear is their best friend. Those who invest only when commentators are upbeat end up paying a heavy price for meaningless reassurance.

It's a known fact that the average stock investor underperforms the market over time. The primary reason -- moving in and out of investments way too often, and generally at the wrong times. When people see everyone else making money from rising markets, that's when they tend to throw every spare dollar into their investments. And when the market drops like a rock, they panic and sell investments "while they still can."

In short, the concept of "buy low, sell high" is well-known as the most basic goal of investing, but many investors do the exact opposite.

Timing the market is generally a losing battle, but there are some good guidelines to follow that should serve you well over the long run. When stocks seem to go nowhere but up and nobody seems to be afraid of a market drop, that's the time to be cautious and conservative. On the other hand, when markets drop and volatility spikes, and people start to panic, that's when to shop for bargains. As Buffett says, "Widespread fear is your friend as an investor, because it serves up bargain purchases."

The lesson: Don't follow the crowd and panic -- look at a correction as an opportunity, and not as a catastrophic event.

Put yourself in a strong position to capitalize

In his 2009 letter, Buffett said:

"Too-big-to-fail is not a fallback position at Berkshire. Instead, we will always arrange our affairs so that any requirements for cash we may conceivably have will be dwarfed by our own liquidity."

Buffett went on to point out that during the financial crisis, Berkshire was a buyer and while most other companies were panicking, Berkshire was completing deals and supplying capital to struggling businesses.

At any given time, Berkshire maintains at least $20 billion of cash-equivalent assets. It currently has well over $100 billion. This allows it the financial flexibility to pounce on opportunities that come up. For example, this is how Berkshire was able to invest $5 billion into Goldman Sachs in September 2008 -- a move that generated billions in profit. As Buffett said in early 2010, "We've put a lot of money to work during the chaos of the last two years."

While I like to keep most of my capital invested, like Buffett, I do try to keep about 5% of my investable assets in cash and equivalents at all times, for precisely the same reason. Keeping some cash on hand allows you to take advantage of corrections without having to sell other investments or deposit more cash.

Buffett's playbook for market corrections and crashes

To sum it up, here's a rundown of some of Warren Buffett's best wisdom to remember during market corrections and crashes: