Mastering the Market Cycle: Getting the Odds on Your Side

Mastering the Market Cycle

by Fred Fuld III

The book, Mastering the Market Cycle: Getting the Odds on Your Side, is a very thorough  analysis and review of all major financial cycles, including economic cycles, stock market cycles, and real estate cycles.

The book is written by Howard Marks, the cofounder and co-chairman of Oaktree Capital Management, which has $120 billion management.

My favorite chapter was Chapter VII: The Pendulum of Investor Psychology, where he discusses the nine elements which swings the pendulum from one direction to another. The same chapter provides the interesting concept of how stocks move no matter what the news, if investors are feeling good.

For  example, if there is strong data, the economy is strengthening and stocks go up. If data is weak, the Fed will probably ease so stocks go up. If the price of oil goes up, it means a growing global economy so stocks go up. If oil drops in price, the consumer has more spending power so stocks go up. He also describes how the reverse can happen when investors’ feelings are negative.

If you want to learn more about market cycles, you should check out  Mastering the Market Cycle.