One of the best ways to enjoy the skewed distribution of outcomes that marks superior investors is to get the market’s tendency on your side. The outcome will never be under your control, but if you invest when the market’s tendency is biased toward favorable, you’ll have the wind at your back, and if the tendency is biased toward unfavorable, the reverse will be true. Skillful analysis of cycles can give you a better-than-average understanding of the market’s likely tendency and thus enable you to improve your chances of properly positioning your portfolio for what lies ahead.
