The Business Cycle Investor provides a forecast of the major turning points in the USA Corporate Profits that are strongly correlated with a broad direction of the U.S. stock market indexes: Dow Jones Industrial Average (DJIA), S&P500 and other major broad market indexes.

The methodology is not perfect; it cannot give always right signals about something so complex and unpredictable like stock market. The only certain thing about it is that one day it will produce a catastrophically wrong buy or sell signal and professional investors using this general recommendation should be always prepared for such event.

Subscriptions to the research are offered to a limited number of professional investors including Global Asset Allocators, Fund Managers and Proprietary Traders. Details of the specific investment strategies are available to our Subscribers and are not disclosed on this website.

The methodology is based on a new proprietary business cycles research applied to a long range timing of the major broad market indexes. The investment model aims to improve chances of identifying the major (not all) more lucrative periods of the broad US stock market that are driven by macroeconomic fundamentals.

Predicting stock market direction is in our view for most of the time impossible as it often behaves irrationally like an unpredictable maniac depressive who overreacts with bursts of optimism or pessimism. However, there are times when Corporate Profits for the whole USA economy grow strongly which inevitably drives the USA stock market higher; in fact the correlation over the past 55 years was 93%. We call these periods the "In Periods" when it pays to invest in the broad market but they represented only 30% of time.

For the majority 70% of time, our methodology was unable to forecast the stock market's direction except to say that we were in a "Out Period" meaning it could move in any direction. Almost half of the Out Periods experienced a major stock market crash. It was safer to stay out of the market in cash or other than equities assets during such times due the uncertainty and high risk.

While the forecast is updated once per quarter, the turning points can be months or years apart. It may seem such long term focused forecast is of little value to short term focused traders and market participants. But in practice even the Daytraders find it very useful. Knowing that market is in a strong long term uptrend, i.e. in the In Period, makes them more confident to take larger long positions. Even if they get it initially wrong, there is always a good probability the market and their positions should recover and return profit.

An average "In the market Period" from a buy to sell signal was 15 months long and achieved 27% ungeared profit excluding dividends, taxes and transaction costs:

Similar performance would be achieved by investing in the S&P500 index.

The returns could be enhanced through a prudent use of financial leverage, derivatives and picking stocks and sectors that are correlated with the cycle and typically outperform the market during "In Periods".

The methodology was validated over 55 years and the forecast published since 2004. An independent organization audits the performance since June 2005. Performance tables have the results. The quarterly recommendations are made public on this website after 12 months.

Purpose

The Business Cycle Investor Advisory Board aims to establish a new investment fund that will have an exclusive right to use the new business cycle and asset allocation model.

This website is a public performance record of the proprietary investment methodology in order to demonstrate its long term effectiveness and to attract experts with ideas on how to turn it into a product that should over time attract larger investment.

We are keen to hear from experts who have good track record in stock picking, assets allocation, sector rotation and forecasting various asset classes - especially Bonds and Property - as they often complement equity cycles and there is an opportunity to enhance the returns by joining forces.

The Business Cycles Live On (chart updated May 31 2009)

In Period	1	2	3	4	5	6	7	8	9	10
Profit %	47.6%	8.3%	35.0%	24.8%	20.8%	29.6%	27.0%	7.6%	29.2%	39.1%

In Period	11	12	13	14	14(2)					AVG
Profit %	51.9%	26.4%	29.6%	1.1%	3.2%					27.0%

`Asset Allocation` | `Research` | `US Index Funds` | `Stock Market Timing` | `ETF` | Dow Jones DJIA | S&P 500

Business Cycle Investor

The Business Cycle Investor provides a forecast of the major turning points in the USA Corporate Profits that are strongly correlated with a broad direction of the U.S. stock market indexes: Dow Jones Industrial Average (DJIA), S&P500 and other major broad market indexes.

Subscriptions to the research are offered to a limited number of professional investors including Global Asset Allocators, Fund Managers and Proprietary Traders. Details of the specific investment strategies are available to our Subscribers and are not disclosed on this website.

An average "In the market Period" from a buy to sell signal was 15 months long and achieved 27% ungeared profit excluding dividends, taxes and transaction costs:

Similar performance would be achieved by investing in the S&P500 index.

The returns could be enhanced through a prudent use of financial leverage, derivatives and picking stocks and sectors that are correlated with the cycle and typically outperform the market during "In Periods".

ETF Investor
Stock market timing with ETFs

Seeking Alpha writer

Stocks & Commodities Magazine Traders.com

Information Sources:

Portfolio asset allocation with ETFs - business cycles stock market timing v
stock picking

ETF exchange traded funds advantage

US business cycles drive global equities asset allocation strategy

investment newsletters directory

DIA price & chart

SPY price & chart

Asset Allocation | Research | US Index Funds | Stock Market Timing | ETF | Dow Jones DJIA | S&P 500

Business Cycle Investor

The Business Cycle Investor provides a forecast of the major turning points in the USA Corporate Profits that are strongly correlated with a broad direction of the U.S. stock market indexes: Dow Jones Industrial Average (DJIA), S&P500 and other major broad market indexes.

Subscriptions to the research are offered to a limited number of professional investors including Global Asset Allocators, Fund Managers and Proprietary Traders. Details of the specific investment strategies are available to our Subscribers and are not disclosed on this website.

An average "In the market Period" from a buy to sell signal was 15 months long and achieved 27% ungeared profit excluding dividends, taxes and transaction costs:

Similar performance would be achieved by investing in the S&P500 index.

The returns could be enhanced through a prudent use of financial leverage, derivatives and picking stocks and sectors that are correlated with the cycle and typically outperform the market during "In Periods".

Information Sources:

`Asset Allocation` | `Research` | `US Index Funds` | `Stock Market Timing` | `ETF` | Dow Jones DJIA | S&P 500