By Dr. Hamik Martirosyan, Guest Writer

Cycles are an inherent feature of markets and economies. The stock market does not progress in a straight upward line—a linear growth in time would be more a sign of a Ponzi scheme than a healthy market. Rather, the market has cyclical swings up and down. At times, these swings are wild.

Incorporating this feature of markets in the construction of your portfolio may help to improve results. However, we have to be cautious so that this strategy does not morph into market timing. Instead, we should use it as a tool to supplement your investment plan.

In his book, Mastering the Market Cycle, Howard Marks discusses the cyclical nature of markets and how to utilize this tendency to position your portfolio for outperformance. He provides valuable insights which might be helpful to us white coat investors.

Nature of Cycles

Keep reading this article on The White Coat Investor.