The stock market, much like the economy it reflects, moves in cycles. These cycles, characterized by periods of expansion, peak, contraction (recession), and trough, significantly influence investment strategies. Understanding these phases and their impact on stock performance is crucial for investors aiming to optimize returns and mitigate risks.
As the economic landscape shifts, so too should your investment approach. During periods of growth, certain sectors and investment styles may flourish, while others might struggle. Conversely, when the economy contracts, defensive strategies often take center stage. This dynamic nature of the market necessitates a flexible and informed approach to investing.
