Here is the new book review of the week. I recently decided to tackle the book The Little Book of Stock Market Cycles: How to Take Advantages of Time-Proven Market Patterns by Jeffrey A. Hirsch. The title sounded promising and it looked like a short book to read (page size is small and there is only a total of 215 pages). Honestly, it was full of interesting facts.
The author Jeffrey A. Hirsch is the Chief Market Startegist of Magnet AE Fund and President of the Hirsch Organization. He wrote many books previously incluing Commodity Trader’s Alamanac and appeared on many media outlets such as FOX and CNBC. Not the most amazing credentials on this blog, but it seems like he know what he is writing about. The book was written in 2012, the year Obama started his second mandate as U.S.A President. The book will tackle various events and wars previous to this date.
The book started on the right foot by reminding us that stock market cycles is an imprecise science. History will never repeat itself exactly and there is a limit as at how much a human can forecast toward the future. He mentions his focus on the more time proven theories/conclusions.
After reading this book for a day, I was satisfied by what I read and learned. It is not a pretentious book that promises to make you a stock expert. Far from there, this book is more of an introduction to make you realise the importance of studying the market before starting to invest. If not, you are just gambling blind.
The many aspects the book talked about included the year cycle of the stock market, when is the best time to invest (November to April), when to leave and when to start again, which months ae consecutively better, etc. As a first chapter, he defines the difference between bear and bull market cycles in simple words that everyone can understand. It talks about the impact of war and peace time, of inflation, of the impact of presidential election and the political decisions being made in Washington (this book was obviously written for an American public).
All in all, I believe you should not start applying the new knowledge learned from the book right away. This book is not the new bible. Instead, it is your responsibility as an investor to do the exercise, check for the last few years if those ideas still hold and then act with caution.
The Little Book of Stock Market Cycles made me realize the concrete existence of patterns inside the stock manipulation world and the importance to consider the PEST factors when making everyday life decision. I didn’t expect too much prior reading the book so this ended up being a pleasant read.