Market Cycle

“The market cycle of the future may prove to be surprisingly independent of the business cycle, and it may even exist if there is no business cycle — which is in itself quite an assumption, but not an entire impossibility.”

“The market cycle will once more prove to be the human-nature cycle; its economic background will have changed, but not its basic character nor the consequences of its character.”

“Having a long term strategy may seem a quaint idea in a market dominated by high frequency trading, the 24 hour news cycle, the ubiquitous and shrill blogosphere, flash crashes, and where it is repeated as though divinely given that buy and hold is dead.”

“Most investors mistake a cyclical recovery for a secular trend”

“True secular changes are obvious only in hindsight”

“Pro-cyclical behavior is one of the greatest and one of the most frequent mistakes.”

“I believe it is highly possible to improve your long-term results by adjusting your investment position at the extremes of the cycle. Not that often. But at the extremes.”

“When things go badly, people become cautious. Then their caution causes things to go well, and when things go well, they become incautious. I think that’s a forever cycle.”

“The most powerful force in finance is mean reversion.”

“I have a great belief that everything is cyclical in life, particularly in the investment world.”

“Unless you are that rarest of birds, someone who is cool under the rapid-fire, high-pressure decision making required to maximize your returns, let others take such risks, and allow your portfolio to plug along at a slower speed. In investing, tortoises tend to win far more often than hares over the turns of the market cycle.”

“You can’t go to sleep holding cyclical stocks for a decade and expect to be richly rewarded. The rich rewards are in growth stocks and special situations.”

“In cyclicals, a period of silly prices is followed by a period of sobriety.”

“Cyclicals are very forgiving. They always give you a second chance.”

“The best time to get involved with cyclicals is when the economy is at its weakest, earnings are at their lowest, and public sentiment is at its bleakest.”

“Those who understand debt cycles can protect themselves.”

“A good record doesn’t necessarily prove good management. Outside economic factors such as the business cycle can make any company look good for a while.”

“The whole reason that our capitalist system works the way it does is because there are cycles, and the cycles self-correct.”

“The fact that a stock is considered to be growth stock is no assurance against a decline in income or market value during the downtrend of a business cycle, as growth stocks often depreciate as much as other groups.”

“The two best ways of measuring the life cycle of an industry are unit volume of sales and net earnings available for stockholders.”

““Growth stocks” can be defined as shares in business enterprises which have demonstrated favorable underlying long-term growth in earnings and which, after careful research study, give indications of continued secular growth in the future.”

“Earnings of most corporations pass through a life cycle which, like the human cycle, has three important phases — growth, maturity, and decadence.”